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    Crypto Exchange FTX could acquire a stake in BlockFi — what we know so far

    Crypto Exchange FTX could acquire a stake in BlockFi — what we know so far

    Crypto Exchange FTX could acquire a stake in BlockFi — what we know so far
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    By CNBCTV18.COM IST (Published)

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    Co-founder of FTX and crypto billionaire Sam Bankman-Fried (SBF) has already lent a helping hand to the struggling crypto lender, providing it with a $250 million emergency line of credit on June 21, 2022.

    FTX is planning to acquire a stake in the crypto-lending platform BlockFi per an article by the Wallstreet Journal (WSJ). Reports from CNBC also indicate that FTX could acquire the embattled firm for as little as $25 million. That's a reduction of more than 99 percent from BlockFi's previous valuation of $4.8 billion in July 2021.
    Co-founder of FTX and crypto billionaire Sam Bankman-Fried (SBF) has already lent a helping hand to the struggling crypto lender, providing it with a $250 million emergency line of credit on June 21, 2022.
    Zac Prince, CEO of BlockFi, confirmed the capital injection on Twitter.
    Another source told The Block that SBF's initial line of credit gave FTX an option on 50 percent of BlockFi equity and that $25 million would cover the rest.
    However, Zac Prince, CEO of BlockFi, has denied these figures, calling them "100 percent rumours".
    While the sale figures may be uncertain, a deal is definitely underway. When asked about the WSJ report, a BlockFi spokesperson told CoinDesk that they were "still negotiating the terms of the deal and cannot share more information at this time. We anticipate sharing more on the terms of the deal with the public at a later date".
    SBF has been busy offering handouts to several beleaguered crypto platforms over the last month or so. Earlier this month, another one of his companies, Almeida Research, acquired a significant stake in Canadian crypto broker Voyager Digital Ltd.
    As per reports, Almeida provided the company with two credit lines, the first was for $200 million in cash and stablecoins, and the second was for 15,000 BTC.
    On the other hand, BlockFi has been navigating troubled waters of late. On June 13, 2022, Prince announced that the company would be slashing around 20 percent of its workforce, citing a "dramatic shift in macroeconomic conditions" as the reason for the move.
    A few days later, Prince also tweeted that the company was forced to liquidate one of its larger clients that "failed to meet its obligations on an overcollateralized loan." While the tweet did not name the client in question, many investors speculated that it had something to do with troubles over at Three Arrows Capital - a large crypto investment firm that found itself on the brink of insolvency.
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