2 years ago
BlockFi’s CEO Zac Prince connected July 1 announced a $400 cardinal recognition installation from FTX and the enactment to acquisition the institution successful its entirety for up to $240 cardinal depending connected performance.
The connection comes little than 24 hours aft CNBC reported that BlockFi was being acquired by FTX for conscionable $25 million. Prince denied the claims instantly but held disconnected releasing further accusation until Friday afternoon.
The President of FTX, Brett Harrison, stated that helium was “excited” to assistance BlockFi done a “strategic partnership.”
FTX US is looking guardant to moving further with @BlockFiZac and the @BlockFi team! We’re excited assistance bolster BlockFi’s concern and enactment unneurotic connected paths towards strategical partnership! https://t.co/SKbql5Hexd
— Brett Harrison (@Brett_FTX) July 1, 2022
BlockFi claims FUD causes liquidity issues
Prince confirmed that BlockFi has not yet required the usage of the indebtedness and that each BlockFi services “continue to run normally.”
In a multi-part Twitter thread, Prince elaborate the events that led to the deal, including confirming that caller marketplace volatility had “a antagonistic interaction connected BlockFi.”
Prince asserted that BlockFi had “no exposure” to Celsius, yet the consequent influx of lawsuit withdrawals led to liquidity issues with the company.
However, Prince confirmed that BlockFi mislaid $80 cardinal erstwhile it liquidated a indebtedness issued to 3AC.
The BlockFi CEO said the nonaccomplishment did not impact lawsuit funds and was its lone vulnerability to the firm. BlockFi’s “risk model combines counterparty recognition analysis, collateral haircuts, and portfolio limits based connected accent testing, and we person zero lawsuit funds successful DeFi protocols,” helium added.
The determination to unafraid a woody with FTX was made successful bid to “add superior to our equilibrium expanse to bolster liquidity and support lawsuit funds.”
Following securing further investment, Prince stated that “there is present adjacent much upside successful the future” for BlockFi clients owed to FTX’s “complimentary” products. He past commented connected the summation successful FUD successful the crypto markets and attempted to quell fears stating that crypto is “an ecosystem connected the rise.”
A bullish aboriginal for BlockFi?
Prince besides announced that involvement rates connected BlockFi would beryllium increased, allowing investors to gain much involvement connected their deposits.
The wide assemblage statement connected the announcement has been broadly positive, with radical specified arsenic Rahu Sood of Irreverent Labs saying, “much respect for however you handled this situation.”
Much respect for however you handled this situation. Ignore the haters and the sound — what you person been done and however you're addressing the concern is remarkable. Congrats to @SBF_FTX and @BlockFi, marque it done this crypto winter, onto the adjacent one.
— Rahul Sood 
∞/21m
(@rahulsood) July 1, 2022
The full Twitter thread tin beryllium recovered below.
(Long thread!)
Excited to stock an update connected our antecedently announced word expanse with @FTX_US – and however we've broadened the scope of the archetypal woody for the payment of each cardinal @BlockFi stakeholders.
— Zac Prince (@BlockFiZac) July 1, 2022
The station FTX gives BlockFi $400M recognition facility; has bargain enactment for up to $240 million appeared archetypal connected CryptoSlate.
English (US) 