Weeks after FTX billionaire CEO gave out a $250 million credit facility to BlockFi, the crypto exchange is reportedly close to acquiring beleaguered BlockFi for a mere $25 million, 99% below BlockFi’s last private valuation as per CNBC.
BlockFi’s current equity investors will get wiped out
Anonymous sources informed CNBC that the two companies, FTX and BlockFi are almost at the end of completing a deal which would see the former pay roughly $25 million for the acquisition of the latter. A mere 1% of the troubled crypto lender’s last private valuation.
Another source relayed that an acquisition could take some time and there is still possibility that the price tag could change between today and Friday, the 1st of July marks the beginning of another quarter and per the source, the day holds significance in completing the deal.
Reportedly, the term sheet to be signed by the end of the week had no “shop clause” and there were multiple offers to be considered. The deal will bring serious losses to equity investors and some other key persons in BlockFi. An implication one of the investors tried to counter.
Both firms refused to give comments on the news. CEO Sam Bankman-Fried stated during the $250 million credit facility period that FTX would help BlockFi “navigate the market from a position of strength”
FTX exited a deal with Celsius due to the crypto lender’s financial status
While FTX was closing up an acquiring BlockFi, the crypto exchange had backed out of a deal with Celsius reportedly. A source told The Block that this happened because Celsius was “difficult to deal with”.
FTX has turned into some form of “messiah” during this “crypto winter”, it has given out credit facilities, acquired beleaguered BlockFi e.t.c There’s definitely a catch for the crypto exchange but its help has saved many from insolvency and another uproar in the market as a result.
Reports have it that there is $2 billion unaccounted for in Celsius’s balance sheet and with its ongoing woes and a decline in price for its native token CEL, it is unsurprising that FTX found the firm difficult to deal with.
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