Crypto lender BlockFi secures a $250M credit line crypto exchange FTX after signing a term sheet providing BlockFi with access to further capital.
“Today’s landmark announcement reinforces BlockFi’s commitment to serving its clients and ensuring their funds are safeguarded,” BlockFi CEO Zac Prince tweeted.
According to the press release, the credit facility proceeds are designed to be legally subject to all client balances at BlockFi throughout all account types including BlockFi Interest Account, BlockFi Personalized Yield, and BlockFi Loan collateral.
The funds will be used as needed to strengthen BlockFi’s balance sheet, highlighting the firm’s long-term stability.
FTX CEO Sam-Bankman Fried seems to be truthful towards BlockFi as he tweets, “BlockFi is financially strong; all operations are normal, as they always have been, and assets are safe.”
BlockFi said the credit facility is contingent on the execution of “definitive documents,” which are scheduled to be finalized in the coming days.
Bankman-Fried implied in his announcement of the line of credit that it could pave the way for a collaboration between FTX and BlockFi.
He said on Twitter “And, going forward, we’re excited to partner with BlockFi to offer industry-leading products.”
This is not the first time that Sam Bankman-Fried has stepped in to help a large crypto company that got affected by the crypto winter. Voyager Digital secured a revolving line of credit from Bankman-Fried-founded quant trading firm Alameda Research last week.
BlockFi is one of the firms that was impacted heavily due to the market collapse. The company is also involved in the liquidation of venture firm Three Arrows Capital (3AC). A few days back, BlockFi announced lay off of about 20% of its total employees.