FTX US Has Agreed to Acquire Crypto Lender BlockFi for Up to $240 Million

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FTX US, the US affiliate of cryptocurrency exchange operator FTX, has inked an agreement that gives it the option to buy cryptocurrency company BlockFi for up to $240 million (roughly Rs. 1,895 crore). FTX operates one of the largest cryptocurrency exchanges in the world. BlockFi, in turn, is a startup with a platform that enables users to buy, sell, and trade digital assets, as well as access cryptocurrency-backed loans. Reports that FTX may acquire the startup amid a selloff in cryptocurrencies first emerged earlier this week.

Previously, FTX provided a $250 million (roughly Rs. 1,974 crore) emergency line of credit to BlockFi. The company stated that the credit line is designed to help the startup “navigate the market from a position of strength.”

If FTX US exercises its newly announced option to acquire BlockFi, the deal would be worth up to $240 million (roughly Rs. 1,895 crore). That price tag includes performance-based incentives. Separately, FTX US has agreed to provide the startup with a $400 million (roughly Rs. 3,157 crore) revolving credit facility.

BlockFi Chief Executive Officer Zac Prince provided more information on the factors that led to this week’s deal with FTX in a series of tweets.

Prince stated that “crypto market volatility, particularly market events related to Celsius and 3AC, had a negative impact on BlockFi.” Celsius Network LLC is a cryptocurrency loan company that last month froze withdrawals and transfers, while 3AC or Three Arrows Capital is a crypto hedge fund. Three Arrows Capital entered liquidation earlier this week.

“The Celsius news on 12 June started an uptick in client withdrawals from BlockFi’s platform despite us having no exposure to them,” Prince wrote. “In the same week, 3AC news spread further fear in the market. While we were one of the first to fully accelerate our over-collateralised loan to 3AC, as well as liquidate and hedge all collateral, we did experience – $80 million (roughly Rs. 631 crore) in losses.”

As for the deal with FTX, Prince stated that BlockFi has not drawn on the $400 million (roughly Rs. 3,157 crore) revolving credit facility provided by the cryptocurrency exchange operator. The executive added that all BlockFi’s products and services will continue to operate as usual.

“The FTX US platform and products are highly complementary to BlockFi and we anticipate enhancements to our services through increased collaboration,” Prince added.


Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or any other advice or recommendation of any sort offered or endorsed by NDTV. NDTV shall not be responsible for any loss arising from any investment based on any perceived recommendation, forecast or any other information contained in the article.





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