The race to acquire distressed crypto lender BlockFi heats up, as Ledn, the crypto loans and savings platform offers to lead a funding round and provide equity in order to leverage a significant share of the company.
BlockFi has certainly suffered its share of hardships from the current crypto crisis. The embattled crypto lender had to liquidate a huge Three Arrows Capital over collateralized margin loan, lay off 20% of its staff, and face suspicion over its current liquidity position.
However, whether for altruistic purposes, or perhaps eyeing up BlockFi as a potentially very cheap near-future acquisition, Sam Bankman-Fried and his FTX exchange together with his other company Alameda Research, have provided BlockFi with a $250 million credit line in order to keep it afloat.
Today, the news has broken that Bankman-Fried is closing in on a deal to purchase BlockFi at a price of between $25 to $50 million, which would mean Bankman-Fried getting BlockFi for ‘pennies on the dollar’. The deal could potentially be signed by the end of this week.
Nevertheless, the deal is still not cut and dried, and it appears that there is another potential buyer waiting in the wings. Ledn is the company in question, and it appears that it has offered BlockFi a different option to the Bankman-Fried deal.
The Ledn plan would entail leading a $400 million fundraiser on behalf of BlockFi, and it would also offer a $50 million equity contribution, allowing it to own a significant part of BlockFi.
Adam Reeds, CEO of Ledn, would not share any specific details about BlockFi, but stated:
“Given its operational strength, Ledn is currently evaluating a number of opportunities to broaden its leadership in digital asset lending and beyond. At the moment, we cannot share any additional details.”
The rumoured Ledn proposition would also include ParaFi Capital according to an article on Bloomberg.
Ledn is a Canadian-based platform that provides a 7.5% yield to its customers from lending out their bitcoin and USDC stablecoins, as well as taking out loans. Unlike the likes of Celsius and others, it does not make any yield by way of decentralised finance.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.