BlockFi, a New Jersey-based cryptocurrency lending platform, has obtained a money service license in Iowa, the company announced on June 28.
We are pleased to announce that we have obtained a money service license at Iowa.
Residents of Iowa can now trade stablecoins on the platform and transfer funds instantly via ACH. pic.twitter.com/sNEFIlCeWY
— BlockFi (@BlockFi) June 28, 2022
Prior to securing this license, BlockFi was fined $ 943,000 by the Iowa Insurance Department. This fine is part of a larger penalty, and BlockFi settled with the US Securities and Exchange Commission and securities regulators in 53 states after offering and selling securities without registering as a broker-dealer or agent. I have agreed to pay 100 million dollars.
Are cracks starting to occur?
According to CEO Zac Prince, BlockFi has to give up $ 100 million in the bear market, where companies such as Celsius, Voyager and Three Arrows Capital (3AC) are facing liquidity problems. It is operating normally.
Nevertheless, Prince recently announced that BlockFi has secured a $ 250 million revolving credit line from a major crypto exchange FTX. According to him, BlockFi planned to use these funds to strengthen its balance sheet.
Shortly thereafter, the WSJ report FTX has revealed that it is in talks to acquire a stake in BlockFi. However, the two companies did not reach an agreement.
Commenting on this news, a BlockFi spokeswoman said:
BlockFi has not commented on market rumors. Transaction terms are still under negotiation and no further information can be shared at this time. We will share the terms and conditions with more people at a later date.
Meanwhile, Morgan Creek Digital is seeking to raise $ 250 million to buy a majority stake in BlockFi, CoinDesk. report On June 26th, I quoted a leaked investor’s phone. Through these efforts, the company aims to prevent losing investment in crypto lending platforms.
Mark Yusco, managing partner of Morgan Creek Digital, reportedly believes that FTX’s offer could overwhelm BlockFi’s current shareholders. According to him, TermSheet gives FTX the option to buy BlockFi “at essentially zero price”. When FTX uses this option, all BlockFi stakeholders will be wiped out.
