BlockFi Admits To Borrowing $400 Million From FTX

Lending company BlockFi has finally provided details of a loan agreement from billionaire Sam Bankman-Fried FTX.US exchange, known for a loan of up to $400 million.

After denying the information of selling BlockFi to FTX for $25 million, the company’s CEO Zac Prince on July 2 revealed details of this loan deal.

According to this official statement, it can be seen that there have been many changes in the agreement between FTX and BlockFi. First, the loan amount was raised from $250 million to $400 million.

Plus the $240 million buyback clause, the valuation that FTX.US awarded to BlockFi is $680 million, down significantly from the $3 billion valuations the company achieved in 2021. In addition, the company also identified received a clause allowing FTX to acquire the company for $240 million, nearly 10 times higher than previous rumors.

Mr. Zac Prince also confirmed the loss from Three Arrows Capital is only $80 million. Previously, many sources claimed that BlockFi had lent 3AC up to $1 billion and mortgaged $1.3 billion of assets.

The CEO stated that the reason for raising capital is to get more money to ensure liquidity and protect user assets. Mr. Prince also tacitly confirmed rumors that the company had received many other offers of help but accepted the deal with FTX because the exchange promised not to touch users’ money in the event of the company’s bankruptcy.

Along with BlockFi, Voyager Digital is another name rescued by FTX when it received a $485 million loan from Alameda Research.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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