Crypto exchange FTX acquiring stake in BlockFi: Report

SAN FRANCISCO: Leading crypto change is reportedly acquiring a stake in the beleaguered crypto lending firm BlockFi, as the crypto industry faces meltdown.

According to Wall Street Journal, FTX is currently in discussions with BlockFi regarding the stake in the firm.

The acquisition talks came as BlockFi secured a $250 million line of credit from FTX, which the crypto industry largely recognised as a "bailout."

"BlockFi does not comment on market rumours. We are still negotiating the terms of the deal and cannot share more information at this time. We anticipate sharing more on the terms of the deal with the public at a later date," a BlockFi spokesperson told Cointelegraph.

BlockFi has signed a deal with FTX to secure a $250 million revolving credit facility with "access to capital that further bolsters our balance sheet and platform strength," said Zac Prince, CEO of BlockFi.

"The proceeds of the credit facility are intended to be contractually subordinate to all client balances across all account types and will be used as needed," he had said in a tweet last week.

Throughout the market volatility of the last several weeks, "I'm incredibly proud of how our team, platform and risk management protocols have performed," he added.

This agreement also unlocks future collaboration and innovation between BlockFi and FTX.

FTX CEO Bankman-Fried who has been quiet about the BlockFi deal criticised venture capitalists for their reluctance to provide funds for crypto startups during the economic downturn.