BlockFi borrows $250 million from FTX

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2022-06-21 16:44:48

BlockFi lending platform is the next name to be “rescued” by an organization related to Sam Bankman-Fried, the FTX exchange.

BlockFi borrowed $250 million from FTX. Image source: Bloomberg

On the evening of June 21, the BlockFi lending unit announced that it had been loaned 250 million USD by FTX, the world’s leading crypto derivatives exchange. This amount will be used to ensure liquidity for users who are depositing funds into the project, as confirmed by BlockFi CEO Zac Prince.

This is BlockFi’s latest move after being involved in rumors of being affected by the “default” scandal of two giants in the cryptocurrency industry, Celsius and Three Arrows Capital. On June 17, Mr. Zac Prince “hidden” about the liquidation of Three Arrows Capital’s assets, and affirmed that users’ assets were still safe, but did not explain why the decision was made. hot loan” FTX like that.

BlockFi last week also announced a 20% reduction in its 850-person staff because of the market situation. The company raised $250 million in March 2021 at a valuation of up to $3 billion, but lowered its valuation to just $1 billion during the June fundraising process.

Thus, BlockFi is the second cryptocurrency unit admitted to have been bailed out by organizations related to billionaire Sam Bankman-Fried. At the end of last week, crypto investment app Voyager Digital announced it had borrowed $485 million in cryptocurrency (value at time of loan) from Alameda Research, an investment fund closely linked to FTX.

In a recent interview, Mr. Sam Bankman-Fried also admitted that he “couldn’t sit idly by” but had to help a number of organizations to avoid a chain-collapse effect.

Other big players that are said to be affected by the Celsius crisis – Three Arrows Capital also includes Finblox, Babel Finance, Hoo and DeFiance Capital.

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