By Sam Boughedda
FTX, the cryptocurrency exchange led by Sam Bankman-Fried, is said to be close to a deal to acquire crypto lender BlockFi for "pennies on the dollar," according to CNBC.
Citing sources, the CNBC article reports that the term sheet is nearly completed and expected to be signed by the end of the week. They add that FTX will pay approximately $25 million, around 99% below BlockFi's most recent private valuation, which valued the company at $4.8 billion, according to PitchBook.
The sources told CNBC that the acquisition could take multiple months to conclude, while the price tag could change by Friday, marking the end of the quarter.
Reports previously emerged that FTX was looking to acquire a stake in BlockFi.
A week ago, FTX provided a $250 million emergency line of credit to BlockFi, with Bankman-Fried stating the financing would help the company "navigate the market from a position of strength."
Another CNBC source reportedly stated investors in BlockFi have been "wiped out" and are now writing off losses.
Earlier today, Oppenheimer analyst Owen Lau said the crypto market is in a crisis with the collapse of Terra/Luna, the Celsius Network pausing client withdrawals, Three Arrows looking for restructuring and a bailout, Babel Finance suspending redemptions and withdrawals, and Voyager having substantial loan exposure to Three Arrows.