Crypto exchange BlockFi secures $250M credit from FTX amid bear market

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BlockFi, a cryptocurrency exchange and digital wallet service provider, has secured a $250 million credit from leading crypto platform FTX.

BlockFi has signed a term sheet with the FTX crypto exchange to secure a $250 million revolving credit facility. A revolving credit facility is a type of credit that enables you to withdraw money, use it to fund your business, repay it, and then withdraw it when needed.

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BlockFi CEO Zack Prince confirmed the news in a Twitter thread, claiming that the new inflow of capital will bolster the firm’s balance sheet and strengthen the platform. The prince said:

“The income of the credit facility is intended to be contractually subordinated to all customer balances across all account types (BIA, BPY and loan collateral) and will be used as needed.”

The $250 million credit for BlockFi comes amid market turmoil, with several crypto firms cutting their workforce and making significant changes to their operations to stay afloat. The bearish dominance in the market also caused many crypto platforms to shut down their operations and stop withdrawals.

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Prince appreciated the efforts of his team during the ongoing volatility in the crypto market and said that the new line of credit will be put in place to protect the users’ funds in all types of accounts.

BlockFi was fined $100 million in February this year for its high-yield interest accounts that were deemed a security product by the United States Securities and Exchange Commission.