BlockFi Receives $250 Million Credit Facility from FTX

FTX, a leading global crypto exchange, has provided BlockFi with a $250 million revolving credit line to backstop the firm during a broad decline in crypto markets.

In a series of tweets, BlockFi founder and CEO Zac Prince revealed the funding that will stabilize the balance sheet of the crypto firm.

 

Prince said the credit facility is intended to be contractually subordinated to all client balances across all account types describing the agreement as a landmark event that reinforces BlockFi’s commitment to serve its clients and ensure all funds are safeguarded.

FTX founder and CEO Sam Bankman-Fried tweeted they are partnering with BlockFi to help them “navigate the market from a position of strength” adding that “sometimes leadership means acting decisively and that’s what BlockFi did: removing troublesome counterparties _before_ they become a problem, and adding cash _before_ it was necessary.”

“We take our duty seriously to protect the digital asset ecosystem and its customers,” said Bankman-Fried

The announcement should remove any concerns about BlockFi being able to service its clients and temper worries about crypto contagion.

In a release, Bankman-Fried stated:

“BlockFi’s team has always demonstrated a strong bias towards prudent risk management and swift action. Protecting customer assets is their top priority which allows them to operate from a position of strength. FTX is excited to partner with BlockFi, a leader in the digital asset ecosystem, to offer first-class products to customers.”

The term sheet is contingent upon the execution of definitive documents and both companies are expecting to execute definitive documentation, to be completed in the coming days.

 

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