FTX US may increase its presence in the crypto market with a new acquisition. According to Zac Prince, CEO of BlockFi, the crypto asset lending company may be sold to the exchange’s US arm.
The announcement about the deal was confirmed by the CEO of the lending platform on Twitter. On July 1, 2022, he said that the two companies had signed a new contract.
The document concerns the possible acquisition of BlockFi, which has not yet materialized. In addition, the two companies also dealt with a US$400 million credit line in the contract.
The agreement between BlockFi and FTX US could result in the acquisition of the lending platform for US$240 million.
“Yesterday, we signed definitive agreements, subject to shareholder approval, with FTX US for a US$400 million revolving credit subordinated to all customer funds and an option to acquire BlockFi at a variable price of up toUS$240 million based on performance triggers”.
Credit line for BlockFi
The devaluation of the crypto market has reverberated into liquidity difficulties for lending platforms like BlockFi. The company is trying to keep operations running normally and has secured US$250 million in revolving credit from FTX.
However, this amount has been increased to US$400 million today. Even with the amount released by the FTX deal, BlockFi said it has not utilized the revolving credit yet.
“To date, we have not used this line of credit and continue to operate all of our products and services as normal”.
FTX US may buy BlockFi after the agreement between the parties is completed. Prior to the crypto lending platform’s CEO’s official announcement, rumors on the market pointed out that the value of the acquisition could be as little as US$ 25 million.