The BlockFI CEO denied the allegations that FTX will be acquiring the platform for only $25 million but if this goes through, it won’t be the first time that the exchange started an acquisition with a line of credit so let’s read more today in our latest cryptocurrency news.
The Acquisition talks between BlockFi and FTX are coming to an end and some sources say that the CEO Sam Bankman Fried’s FTX crypto exchange could only pay $25 million to acquire the lender. The CEO of BlockFi Zac Prince wrote on Twitter:
“Lots of market rumors out there. I can 100% confirm that we aren’t being sold for $25M. I encourage everyone to trust only details that you hear directly from @BlockFi.
We will share more w you as soon as we can.
— Zac Prince (@BlockFiZac) June 30, 2022”
The BlockFI CEO denied the rumors but if it does come to that, FTX will be paying a small chunk for the embattled crypto lending company. Blockfi is based in New Jersey and has a valuation of $3 billion after raising its $350 million Series D last year. The company reached a $100 million settlement with the state regulators and the US SEC over the BLockFi Interest Accounts and it is rumored to be holding a huge portion of the toxic debt as a part of the fallout from the hedge fund Three Arrows Capital’s liquidation.
An FTX spokesperson said that it will not be commenting on the matter but another spokesperson for Blockfi said the company will not comment on market rumors. In the past week, BlockFi and FTX announced that the lender secured $250 million revolving line of credit for the exchange as Prince added:
“This agreement also unlocks future collaboration and innovation between BlockFi & FTX as we work to accelerate prosperity worldwide through crypto financial services.”
If FTX winds up acquiring BLockfi, it will not be the first time that it started the term sheet negotiations by offering the bailout. The exchange did something similar with the Japanese fintech company Liquid Group and closed the deal to purchase the company for an undisclosed amount in April. FTX offered the company another $120 million loan after $90 million were stolen in a hack and then announced that it was in talks to acquire the company earlier this year.
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