BlockFi, a crypto-financial service provider, has secured $250 million revolving credit from cryptocurrency exchange FTX. The CEO of BlockFi announced this partnership through Twitter and assured that the loan would drive the expansion and ‘Bloster’ the platform strength. BlockFi is a crypto lending firm that offers credit services at an attractive rate.
FTX CEO Sam Bankman Fried has also said that the $250 million injections in BlockFi will help boost its strength as a financial services provider.
BlockFi has been struggling for liquid cash. The recent blood bath of the crypto market has brought crypto lending services to the edge of collapse. According to a Financial Times report, BlockFi was among the lenders that liquidated a loan of $400 million from 3AC. The company had claimed that it does not impact client funds; however, BlockFi is going through a liquidity crunch if rumours on social media are to be believed.
This crypto lending company has also announced a 20% workforce reduction following the massive slump in the crypto market. The current loan from the FTX has indicated the situation BlockFi is in and how this capital boost could help it recover from the current crisis.
FTX, a cryptocurrency exchange with an average daily volume of around $2 billion, has been sailing through the current crypto market slump without any issue. In contrast, rival exchanges such as Coinbase have suffered considerable losses. FTX CEO has lately announced that his firm is willing to help crypto companies facing financial trouble, and BlockFi is the first company to redeem funds from FTX after the announcement.
Gargi Sinha is working as Senior Journalist at Confea. She has completed her Masters in Journalism from Delhi University. She has interest in crypto and blockchain technology.