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FTX negotiates acquisition of BlockFi

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While the crypto market is in a downturn, acquisitions – and negotiations for acquisitions – are in full swing.

This time it is cryptocurrency exchange FTX, led by billionaire Sam Bankman-Fried, which is in talks to acquire part of cryptocurrency lender BlockFi, according to a Wall Street Journal report published this Friday (24).

The alleged trade comes shortly after FTX earlier this week bailed out BlockckFi, which faced liquidity problems.

In the case, the digital asset exchange secured a $250 million emergency line of credit from the company. According to BlockFi, the move bolstered the platform’s balance and strength.

“Proceeds from the line of credit must be contractually subordinated to all customer balances across all account types (BIA, BPY and loan guarantee) and will be used as needed,” the company said on June 21.

At the time of the rescue, both BlockFi CEO Zac Prince and Bankman-Fried hinted at the possibility of greater cooperation between the organizations.

“This agreement also unlocks future collaborations and innovations between BlockFi and FTX. Meanwhile, we work to accelerate prosperity around the world through crypto financial services,” tweeted BlockFi CEO Zac Prince at the time.

FTX trades with BlockFi

Also according to the WSJ, negotiations between FTX and BlockFi are ongoing. That is, no final term has been reached so far.

Contacted for more information, a BlockFi spokesperson said the company “does not comment on market rumours”.

“We are still negotiating the terms of the agreement and cannot share more information at this time. We anticipate sharing more about the terms of the deal with the public at a later date,” she said.

It is worth noting that BlockFi received a fine of US$ 943,000 in the US for not having registered securities in the state.

Additionally, the company confirmed last week that it liquidated a “large client” amid reports that digital asset hedge fund Three Arrows Capital (3AC) was unable to meet margin calls.

Sam Bankman-Fried Helps Crypto Market

Meanwhile, Sam Bankman-Fried has positioned himself in recent weeks as a “savior” of the crypto market amid sell-offs and asset price drops.

In addition to FTX bailing out BlockFi, Sam Bankman-Fried’s other company, Alameda Research, gave cryptocurrency exchange Voyager Digital (VOYG) a revolving line of credit for $200 million plus 15,000 Bitcoins.

BTC could face three years of bear market if price drops to $10,000

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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