BlockFi gets $250 million credit facility from FTX to support platform News ▸ FTX ▸ Partnerships
BlockFi gets $250 million credit facility from FTX to support platform
BlockFi intends to use the proceeds of the $250 million credit facility to bolster its balance sheet and platform strength.
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Updated: Jun. 21, 2022 at 5:17 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Crypto lending platform BlockFi has signed a term sheet with leading crypto exchange FTX to secure a $250 million revolving credit facility, BlockFi CEO Zac Prince announced June 21.
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 Prince, this agreement will offer BlockFi access to additional capital, which the firm will use to strengthen its balance sheet.
The proceeds of the credit facility will contractually be subordinate to all client balances across all BlockFi accounts. These include BlockFi Interest Account (BIA), BlockFi Personalized Yield (BPI), and BlockFi loan collateral. BlockFi intends to use the proceeds to bolster its operations as the bear market continues ravaging the crypto space.
BlockFi seeks to keep user funds safe
Prince noted that this deal underscores BlockFi’s commitment to serving its clients and ensuring the safety of their funds.
In the past week, Celsius Network suspended withdrawals, swaps, and transfers on its platform due to liquidity issues. In a ripple effect, crypto hedge fund Three Arrows Capital (3AC) faced liquidation after failing to meet margin calls from lenders. According to a Financial Times report, BlockFi was among the lenders that liquidated 3AC.
While BlockFi did not confirm its role in liquidating 3AC, Prince said the company liquidated a large counterparty after failing to meet margin calls. He did not reveal the name of the said counterparty. However, Prince claimed BlockFi was among the first lenders to liquidate the third party, and that acting quickly helped keep customer funds safe.
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Jinia Shawdagor
Jinia is a fintech writer based in Stockholm, Sweden. With years of experience, she has written about cryptocurrency and blockchain for renowned publications such as Cointelegraph, CoinMarketCap, Bitcoinist, Invezz, etc.
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Celsius
$0.22679
Celsius Network is a P2P decentralized lending & borrowing platform.
BlockFi
BlockFi is a defunct cryptocurrency lender company which is currently in bankruptcy proceedings.
FTX
FTX is a defunct cryptocurrency exchange, currently in bankruptcy proceedings, that was founded by Sam Bankman-Fried and Zixiao “Gary” Wang in May 2019.
Celsius Network
Celsius Network is a bankrupt cryptocurrency lending company that was founded in 2017 and headquartered in Hoboken, New Jersey.