BlockFi, an embattled crypto lending platform that recently announced a 20% cut to its workforce, has received a $250 million revolving credit facility from FTX.
FTX Provides $250 Million Bailout for BlockFi
On Tuesday, June 21st, Zac Prince, the CEO of BlockFi, one of the crypto firms to be impacted heavily by the recent market downturn, announced that the company had received a $250 million bailout fund.
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 credit facility would give the lending platform access to capital that would help to “further bolster our balance sheet and platform strength”.
With the agreement, BlockFi will be able to access capital during a rout in the digital currency market. Although BlockFi has not disclosed terms of the agreement, or the rate of interest, it was clarified that the facility would be subordinate to all client balances in the event that BlockFi were to fail.
FTX Boss Praises the Move from BlockFi
Sam Bankman-Fried praised the move by the crypto lender, writing on Twitter (NYSE:TWTR) that “sometimes leadership means acting decisively, and that’s what BlockFi did.”
This is not the first time FTX has dealt out a bailout, having recently provided a $485 million cash and Bitcoin bailout to crypto broker Voyager Digital.
On the Flipside
- BlockFi recently liquidated Three Arrows Capital after the crypto hedge fund failed to meet fund demands to cover its digital currency bets.
Why You Should Care
The rescue by FTX is part of an attempt to restore investor confidence during the period of intense sell-off and market crash.
Get more information about BlockFi’s lay-offs below:
BlockFi Lays Off 20% of Its Staff Amidst Cryptocurrency Market Downturn
Learn more about BlockFi’s liquidation:
BlockFi liquidates Three Arrows Capital
Read about BlockFi’s financial issues in:
BlockFi to Pay $100 Million to the SEC for Offering Unregistered Securities