FTX to provide BlockFi with a $250 million revolving credit facility

BlockFi signed a letter of intent with the cryptocurrency exchange FTX to secure a $250 million revolving credit facility.

Today @BlockFi signed a term sheet with @FTX_Official to secure a $250M revolving credit facility providing us with access to capital that further bolsters our balance sheet and platform strength.

— Zac Prince (@BlockFiZac) June 21, 2022

According to Zac Prince, the CEO of the crypto-lending platform, access to capital “will further strengthen the balance sheet and the company’s reliability.”

If needed, BlockFi will deploy resources to support all product types.

Prince noted that the news underscores the platform’s commitment to customer service and safeguarding users’ funds.

The BlockFi CEO added that the agreement opens opportunities for cooperation between the companies. He said he would share more details about future plans in the near term.

An analyst going by the handle FatMan described the arrangements as a “deal with the devil”.

Congratulations, you have made a deal with the devil

— FatMan (@FatManTerra) June 21, 2022

A user with the handle Raja saw in the agreement the machinations of FTX chief Sam Bankman-Fried, who “puts everyone in such a position, and then ‘bails them out’.”

Sam puts everyone in this position, then bails them out. Cool.

— Raja (@RajaZuberi) June 21, 2022

Earlier in June, media reports said BlockFi was preparing to close a new funding round at a $1 billion valuation instead of the previously planned $5 billion.

Subsequently, the company announced the layoff of a fifth of its staff.

According to reports, amid recent market turbulence, the crypto-lending platform liquidated at least part of the hedge fund Three Arrows Capital’s positions.

In June, Bankman-Fried said that he was taking steps to mitigate negative developments in the crypto market due to Celsius and Three Arrows Capital issues.

On June 18, the cryptocurrency broker Voyager Digital said, that Alameda Research provided it with a loan of 200 million USDC and a revolving credit line of 15,000 BTC (~$300 million).

Earlier Bankman-Fried pledged to spend “billions” on acquiring stakes in other companies.

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