Crypto lending platform BlockFi has secured $250 million in revolving credit from Sam Bankman-Fried’s FTX, the firm said in a press release on Tuesday.
The credit allows BlockFi access to further capital at a time the crypto market has seen a prolonged crash, with several firms sinking into liquidity problems. As such, BlockFi will use the funds to bolster its balance sheet and look to establish long-term stability.
Zac Prince, the CEO of BlockFi confirmed this via a tweet, noting:
Today @BlockFi signed a term sheet with @FTX_Official to secure a $250M revolving credit facility providing us with access to capital that further bolsters our balance sheet and platform strength.
— Zac Prince (@BlockFiZac) June 21, 2022
He added in a statement:
“This agreement also unlocks future collaboration and innovation between BlockFi and FTX as we work to accelerate prosperity worldwide through crypto financial services. This is a significant step forward in our continued commitment to the strength and accessibility of cryptocurrency markets.”
FTX CEO Bankman-Fried added:
1) Today we’re injecting $250m into BlockFi and partnering with them so they can navigate the market from a position of strength.https://t.co/nocsdi0GLF
— SBF (@SBF_FTX) June 21, 2022
The credit facility agreement between BlockFi and FTX comes just days after Bankman-Fried said his company (and Alameda Research) would “step in” to help distressed crypto projects as the market reels from a brutal downturn.
It also comes not long after BlockFi said it had been forced to liquidate one of its large clients for failing to meet margin calls.
Celsius Network, Three Arrows Capital and Babel Finance have all hit news headlines in the past week over liquidity issues.