BlockFi expects that the increased credit line would help them secure customer funds when many crypto platforms are fighting to stay afloat.
BlockFi, a cryptocurrency exchange and digital wallet provider have received a $250 million credit from FTX, a renowned cryptocurrency exchange.
BlockFi has secured a $250 million revolving credit line by signing a term sheet with the FTX crypto exchange. A revolving credit facility allows you to take money out, use it to fuel your business, repay it, and then take it out again when needed.
In a Twitter thread, BlockFi’s CEO, Zac Prince, confirmed the announcement, claiming that the new infusion of funds would help the company’s balance sheet and platform. The proceeds of the credit facility will be contractually subordinated to all client balances across all account types (BIA, BPY, and loan collateral) and used as needed, according to Prince.
The $250 million credit for BlockFi comes amid market volatility, which has seen many crypto companies slash their workforces and make necessary modifications to their operations to stay afloat. Due to the adverse market trend, many crypto services had to shut down operations and halt withdrawals.
Prince praised his team’s work amid the current crypto market volatility and noted that the new line of credit would be used to protect consumers’ assets across all account types.
The United States Securities and Exchange Commission fined BlockFi $100 million in February this year for its high-yield interest accounts, which were classified as security products by the SEC.