BlockFi Secures $250 Million Revolving Credit Facility from FTX

Crypto lending platform BlockFi announced that it has secured a $250 million revolving credit facility from FTX, BlockFi CEO Zac Prince said in a tweet on Tuesday.

"Today BlockFi signed a term sheet with FTX to secure a $250M revolving credit facility providing us with access to capital that further bolsters our balance sheet and platform strength,"Prince said."The proceeds of the credit facility are intended to be contractually subordinate to all client balances across all account types (BIA, BPY & loan collateral) and will be used as needed."

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The agreement comes during a downturn for crypto markets and the fall of stablecoin UST and decentralised finance protocol Celsius.

Last week, Prince tweeted that BlockFi had also been forced to liquidate a large client which "failed to meet its obligations on an overcollateralized loan." The statement — which didn't name a specific client — came amid speculation surrounding the solvency of Three Arrows Capital, a major crypto investment firm.

This is not the first time FTX CEO Sam Bankman-Fried has stepped in to bail out a major crypto company impacted by the recent market downturn. Last week, crypto broker Voyager Digital (VOYG) secured a revolving line of credit with Bankman-Fried-founded quant trading shop Alameda Research.

Though it is now in the position of backstopping a broader market crash, FTX is reportedly one of the firms that liquidated Celsius — the troubled crypto lending platform that was forced to halt all user withdraws last week. Celsius, one of BlockFi's competitors, reportedly ran out of funds to repay depositors due to a series of risky decentralized finance bets.

Source: CoinDesk