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Crypto Lender Blockfi Secures $250 Million Line of Credit From FTX, CEO Says Capital Will Bolster Its Balance Sheet

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On Tuesday, crypto lender Blockfi revealed that the company received a $250 million credit line from FTX. Blockfi CEO Zack Prince announced on Twitter that the company will use the capital to strengthen the “balance and strength of the Blockfi platform.”

Blockfi secures $250 million revolving credit line from FTX as crypto lending firms grapple with market volatility in 2022

  • This has been a tough year for crypto lenders due to digital assets losing significant value over the past few months. One lender, Celsius, was charged with insolvency and suspended withdrawals last week.
  • In 2021, U.S. securities regulators from various states issued cease and desist orders to Celsius and crypto lender Blockfi. In February 2022, the US Securities and Exchange Commission (SEC) accused Blockfi of not registering its products for retail crypto lending.
  • In the second week of June, Blockfi co-founders Zach Prince and Flory Marquez announced that the company would lay off “roughly 20%” of its staff due to “market conditions” that had a “negative impact” on the company.
  • June 16 Prince discussed “speculation about BlockFi’s risk management practices”, and Blockfi’s CEO emphasized that the company always ensures “prudent and proactive risk management”.
  • On Tuesday, Prince revealed that Blockfi had received a $250 million line of credit from FTX. “Blockfi today signed an agreement with FTX to provide a $250 million revolving line of credit providing us with access to capital that further strengthens our balance sheet and platform sustainability,” Blockfi CEO. said.
  • “Proceeds from the facility are intended to be contractually subject to all customer balances across all account types (BIA, BPY and loan collateral) and will be used as needed,” Prince said. continuation on his Twitter thread.
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  • Blockfi’s CEO added that during the volatility of the cryptocurrency market, he was proud of the company’s risk management protocols and beyond. said that the agreement with FTX “gives access to the future [collaborations]with a crypto company.
  • Meanwhile, as Celsius put withdrawals on hold, the cryptocurrency lending company has updated the community in a recently published Blog post. “We want our community to know that our goal remains to stabilize our liquidity and operations. This process will take time,” Celsius said in a blog post.
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What do you think of the current state of crypto lending firms? What do you think about Blockfi getting $250 million from FTX? Let us know what you think about it in the comments section below.

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Credit : news.bitcoin.com

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