fbpx
0

FTX Completed the Blockfolio Deal Mainly in FTT Tokens: Report

Share

The collapsed cryptocurrency exchange FTX reportedly paid 94% of the $84 million purchase of a majority stake in Blockfolio in FTT tokens. 

The coin played a leading role in the platform’s crash last month. CZ said Binance plans to dump its entire FTT stash (23 million tokens worth over $580 million at the time) amid rising worries about the over-exposure of FTX and Alameda towards the former’s native asset.

New Data on the Blockfolio Deal

According to a recent Bloomberg coverage, FTX acquired a majority stake in the trading platform Blockfolio in 2020 using almost entirely FTT tokens (the native asset of the bankrupt exchange). 

Sources previously disclosed that the former crypto behemoth financed the agreement with a mixture of digital currencies, cash, and equities, without providing accurate information. Initial reports suggested FTX spent $150 million to finalize the deal.

Established in 2014, Blockfolio became one of the leading firms in its field, amassing nearly six million customers in the following years. It shook hands with the notorious FTX to add a retail trading experience for its users and later took the name of the exchange.

For its part, the platform’s native token was in the spotlight last month after Binance said it will sell its entire FTT holdings (worth $584 million at the beginning of November). 

The move triggered a wave of customer withdrawals and FTX could not honor those requests. The exchange filed for bankruptcy protection several days later, owing billions of dollars to investors.

The negative event had a devastating effect on FTT’s price. The token is currently trading at around $0.87 (nearly 99% down compared to its peak in September 2021).

The SEC Views FTT as Security

The US Securities and Exchange Commission (SEC) recently claimed that FTT should be considered an “illiquid crypto asset security that was issued by FTX and provided to Alameda at no cost.”

The agency further maintained that the bankrupt exchange had used profits from the asset’s sale to boost the development, business operations, and marketing of its brand. At the same time, it lured consumers that its token is an “investment” with great potential.

“The FTT materials made clear that FTX’s core management team’s efforts would drive the growth and ultimate success of FTX. The whitepaper also advertised that certain features gave FTX an advantage over competing platforms, including industry-leading risk management systems and its liquidation engine model,” the Commission stated.

SEC Chairman Gary Gensler has previously outlined that bitcoin is the only cryptocurrency that could classify as a commodity. 

SPECIAL OFFER (Sponsored)

Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).

PrimeXBT Special Offer: Use this link to register & enter POTATO50 code to receive up to $7,000 on your deposits.

#FTX #Completed #Blockfolio #Deal #FTT #Tokens #Report

%d bloggers like this: