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BlockFi CEO Provides More Details on the $250M Revolving Credit Taken From FTX

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Yesterday, popular cryptocurrency lending company BlockFi announced a $250 million revolving line of credit from cryptocurrency exchange FTX to bolster its balance sheet and solidify its position in the bear market.

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While CEO Zack Prince did not elaborate on the details of the line of credit, he noted that the proceeds ensure that customers get their funds back if the company goes into liquidation during the crisis.

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The announcement sparked concern, with many wondering if BlockFi is experiencing liquidity issues like other lending platforms and why the company needs a loan that isn’t meant to expand.

Offensive and defensive move

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However, the prince spoke Bloomberg in a telephone interview, providing more details on the line of credit. The BlockFi CEO said the loan will help the company protect customer funds as the market continues to be volatile.

He said the strategic partnership with FTX was “both offensive and defensive in equal measure.” He noted that people with “an untrained eye” would think that BlockFi’s business model is similar to other firms, but those with a “skilled eye” understand that “it’s day and night.”


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“We felt it was a smart, offensive and strategic decision for BlockFi to keep the balance high and tell everyone about it,” he said.

Prince: Everything works

BlockFi’s CEO said the company continues to have a good relationship with all of its banking partners. According to him, the crypto lender had two bitcoin-backed credit lines at two banks and had borrowed partial amounts before the Terra LUNA collapse. While the company still has these funds in banks, the amount raised is currently zero.

He also confirmed that the company had a lot of withdrawal requests last week due to concerns, but that the number is down 88% from its peak and the decline is expected to continue. In addition, he noted that “everything works as always.”

Meanwhile, Zach Prince also commented on the current market conditions. He believes that at some point in the future, when the crypto market turns bullish, people will look back and say, “It was a phenomenal time to buy,” because crypto assets still have a lot of upside potential.

Featured image courtesy of Money INC

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Credit : cryptopotato.com

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