FTX, a cryptocurrency exchange founded by billionaire Sam Bankman-Fried, is exploring taking a stake in crypto lender BlockFi, people familiar with the matter told the Wall Street Journal on Friday.
The crypto firms have not reached an equity agreement, the WSJ reported, citing the people with knowledge on the discussions.
The potential move comes shortly after FTX bailed out BlockFi with a $250M line of credit amid a broader liquidity crunch.
In addition, Alameda Research, Bankman-Fried’s quant trading shop, has taken a large stake in crypto broker Voyager Digital (OTCQX:VYGVF), the WSJ noted. That followed Alameda’s move earlier in June to extend two credit lines in the form of cash, stablecoins and bitcoin (BTC-USD) to Voyager.
Specifically, Alameda in May had bought a $35M stake in Canadian-based Voyager Digital (OTCQX:VYGVF), the WSJ said, adding that it paid $2.34 per share to acquire 14.96M shares. Amid the current crypto downturn, the purchase price was discounted by nearly 16% to the market price at the time.
“What you’ll see is a lot of private deals placed below market price,” Kevin Dede, a managing director at H.C. Wainwright told the WSJ. “It depends on the financial condition of the company.”
Shares of Voyager (OTCQX:VYGVF) have since nosedived around 75% after it disclosed over $660M loan exposure to troubled crypto hedge fund Three Arrows Capital. Shortly thereafter, the company slashed its daily withdrawal limit to $10K from $25K.
Earlier this week, (June 23) FTX U.S. head calls for more regulation after crypto’s “time for extreme experimentation.“
Read More:Sam-Bankman Fried’s FTX in talks to invest in crypto lender BlockFi (OTCMKTS:VYGVF)