FTX Reaches Deal To Acquire BlockFi for up to $240M

The agreement will also give BlockFi a $400 million revolving credit facility


FTX’s Sam Bankman-Fried | Blockworks exclusive art by axel rangel


key takeaways

  • Bankman-Fried says he is “way more excited to bail out customers than shareholders”
  • FTX’s acquisition of BlockFi may lead to potential layoffs

FTX on Thursday closed an anticipated deal with BlockFi to acquire the troubled crypto lender for up to $240 million, depending on the startup’s performance triggers.

The agreement also involves a $400 million revolving line of credit, good for a total price tag of $620 million. 

Loading Tweet..

Blockworks reported the acquisition will likely lead to additional BlockFi layoffs, as FTX is predominantly vying for the lending startup’s technology, investors and counterparties. The prospect of immediate job losses were later denied by BlockFi CEO Zac Prince and FTX CEO Sam Bankman-Fried.

Although Prince did not disclose the lower end of the acquisition, CNBC reported the deal was pegged at $25 million. Prince denied CNBC’s reporting, which he dubbed unfounded. 

Market volatility following the downfall of Celsius and Three Arrows Capital (3AC) put cryptocurrency lenders in a difficult position.

“While we were one of the first to fully accelerate our overcollateralized loan to 3AC, as well as liquidate and hedge all collateral, we did experience ~$80M in losses, which is a fraction of losses reported by others,” Prince tweeted.

JPMorgan researchers predict that deleveraging is already advanced, and — with the assistance of deep-pocketed crypto firms stepping in to ease the contagion — debt-related mayhem may soon come to an end.

“We are trying to find who were the responsible players who were building out a good business, had a sustainable model and could use short term liquidity that could help protect customer funds,” Bankman-Fried told BloombergTV.

Added Bankman-Fried: The firm is “way more excited to bail out customers than shareholders.”

In fact, if BlockFi’s valuation was to rise above $240 million, shareholders would be unable to refuse BlockFi’s acquisition. 

Loading Tweet..

“The focus of this is not how much we can deliver shareholder value,” Bankman-Fried said. “It’s how do we protect customers, and I think those imply pretty different things.”

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Frax report cover.jpg


Frax saw continued development in its frxETH liquid staking derivative and Fraxlend money market throughout 2023. Frax V3 introduces an RWA strategy to drive utility to the protocol's cornerstone product, the FRAX stablecoin.


Heron Finance caters to US accredited investors and uses Goldfinch credit markets on the backend


Bitcoin, up more than 160% year to date, has plenty of steam left in this rally, analysts say


Nova Labs will hope to grow Helium’s hotspot network to reduce backup coverage costs paid to T-Mobile


The LinkedIn posting states that the position would “support the Federal Reserve System’s [CBDC] Research and Development program.”


Both central banks are exploring the impact a CBDC could have on an economy


Neutron core contributor Dutheil notes this is “a period of consolidation” in the Cosmos ecosystem