Blockfi Secures $250 Million From FTX
Blockfi Secures $250 Million From FTX
A cryptocurrency lender named Blockfi disclosed on Tuesday that FTX has given the company a $250 million line of credit. According to the company's CEO Zac Prince, who announced the news on Twitter, the money will be used to improve Blockfi's "balance sheet and platform robustness."
Due to the massive decline of digital assets over the past few months, it has been a difficult year for crypto lenders. Due to allegations of bankruptcy, one lender, Celsius, halted withdrawals last week.
Other related news : Celsius was once a $28 billion giant that has plummeted by 88 percent this year.
State-based U.S.In 2021, desist notices were sent to Celsius and the cryptocurrency lender Blockfi by regulatory agencies. The U.S. Blockfi was accused of failing to register its retail crypto loan products by the Securities and Exchange Commission (SEC) in February 2022.
The co-founders of Blockfi, Zac Prince and Flori Marquez, declared in the second week of June that "about 20 percent" of the company's staff will be let go.
In a statement released on June 16 in response to Prince's discussion of "speculation surrounding BlockFi's risk management practises," the CEO of Blockfi emphasised that the firm always implements "prudent and aggressive risk management."
On Tuesday, Prince announced that FTX had granted Blockfi a $250 million line of credit. Blockfi's CEO stated, "Today, we signed a term sheet with FTX to establish a $250M credit line, providing us with cash that further boosts our balance sheet and platform stability.
Prince said in his Twitter thread, "The proceeds of the credit line are designed to be legally subordinate to all customer balances across all account types (BIA, BPY & loan collateral) and will be utilised as needed.
The Blockfi's CEO continued by expressing his pride in the company's risk management procedures during the recent turbulence in the cryptocurrency market. He also stated that the deal with FTX "unlocks future collaborations" with the crypto firm.
Since Celsius stopped processing withdrawals, the crypto-lending firm informed the public in a recently posted blog post. "Maintaining the stability of our operations and liquidity is our priority, and we want our community to know that. This procedure will take some time, according to the Celsius blog post.
