BlockFi’s boss denied a report Thursday that FTX was close to purchasing his embattled cryptocurrency lender for just $25 million during ongoing “crypto winter” conditions and plunging bitcoin prices which have rattled investors.
BlockFi CEO Zac Prince spoke out shortly after a report said that crypto billionaire Sam Bankman-Fried’s FTX was days away from buying the struggling firm at a serious discount.
The rumored $25 million is a 99% discount from BlockFi’s most up-to-date private valuation of $4.8 billion.
“Plenty of market rumors on the market – I can 100% confirm that we aren’t being sold for $25M. I encourage everyone to trust only details that you simply hear directly from @BlockFi,” Prince said. “We’ll share more w you as soon as we will.”
Plenty of market rumors on the market – I can 100% confirm that we aren’t being sold for $25M.
I encourage everyone to trust only details that you simply hear directly from @BlockFi.
We’ll share more w you as soon as we will.
— Zac Prince (@BlockFiZac) June 30, 2022
The Post also reached out to FTX for comment.
CNBC reported that FTX is close to purchasing BlockFi for $25 million in a deal that was “expected to be signed by the tip of the week.” One source noted the ultimate price tag could shift by Friday.
One other source told the outlet that BlockFi’s equity investors are “worn out” because the lender struggles to survive a downward spiral in cryptocurrency prices.
FTX recently prolonged a $250 million line of credit for BlockFi.NurPhoto via Getty Images
Prince’s tweet didn’t explicitly rule out the potential for a sale for BlockFi, which reached an agreement with FTX on a $250 million emergency line of credit just last week. BlockFi representatives declined to supply further comment on a possible sale.
“BlockFi’s team has all the time demonstrated a robust bias towards prudent risk management and swift motion. Protecting customer assets is their top priority which allows them to operate from a position of strength. FTX is happy to partner with BlockFi, a pacesetter within the digital asset ecosystem, to supply first-class products to customers,” Bankman-Fried said in a press release on the $250 million credit line.
An earlier report said BlockFi was near selling for just $25 million.dpa/picture alliance via Getty I
Bitcoin’s value briefly dipped below $19,000 on Thursday as investors braced for the potential for a recession and reacted to mounting fears of a liquidity crisis hitting major operators throughout the sector. Cryptocurrency hedge fund Three Arrows was ordered to liquidate this week after facing legal challenges from creditors over unpaid debts.
Earlier this month, BlockFi – whose backers include tech billionaire Peter Thiel – revealed that it could cut staff by 20% during what Prince described as a “dramatic shift in macroeconomic conditions.”
Sam Bankman-Fried is the billionaire head of FTX.CQ-Roll Call, Inc via Getty Imag
“We’re steadfast in our commitment to make sure BlockFi is here for the long haul,” Prince said on the time. “Our clients is not going to experience any material changes to the standard of service they’ve come to expect, their funds are safeguarded, and all platforms and products proceed to operate normally.”
Days later, The Post reported that BlockFi was struggling to boost money to assist keep its operations afloat even after offering to take a steep discount on its valuation.