After rescuing crypto-asset broker Voyager Digital last week, crypto exchange FTX founder Sam Bankman-Fried, often known as SBF, has now agreed to bail out crypto lender BlockFi.
See related article: BlockFi among those that foreclosed on Three Arrows Capital: report
Fast facts
- FTX agreed to extend a US$250 million revolving credit facility to BlockFi on Tuesday, BlockFi CEO Zac Prince said on Twitter.
- BlockFi fully accelerated a loan, fully liquidating or hedging all associated collateral with a large client that failed to meet its obligations on an overcollateralized margin loan, Prince said on June 17. “We believe we were one of the first to take action with this counterparty,” he said.
- “BlockFi has careful risk management and great leadership” and acted preemptively to remove at-risk counterparties “with no debt/risk from 3AC, Celsius, etc.,” Bankman-Fried said.
- On June 17, Voyager Digital announced that it had secured a revolving loan of US$500 million from Alameda Research, SBF’s quantitative research firm.
- Voyager has said that it will pursue recovery from crypto hedge fund Three Arrows Capital (3AC) but has yet to determine the amount it will be able to recover.
- On Wednesday, Voyager announced that it would issue a “notice of default” to 3AC in case of failure of loan repayment.
- Voyager’s total exposure to 3AC amounts to approximately US$650 million — 3AC had taken a loan of around US$350 million worth of USDC and 15,250 Bitcoin valued at over US$300 million at current prices.
- 3AC is supposed to repay US$25 million worth of USDC by June 24 and the entire loan amount by June 27, but has yet to repay any of the amounts.
- Voyager shares tanked by over 53% over the past day since the firm declared its exposure to 3AC.
See related article: Contagion risk from Three Arrows Capital weighs on Bitcoin, crypto