FTX Undeterred by Crypto Winter, Continues Courting Deep-Pocket Investors

CNBC report­ed on Wednes­day that cryp­tocur­ren­cy exchange FTX is in talks with investors for up to $1B in new cap­i­tal at a val­u­a­tion of about $32B, accord­ing to sources with direct knowl­edge of the matter.

The nego­ti­a­tions are ongo­ing, and the terms could change, claim the peo­ple cit­ed in the paper. The exchange is yet to con­firm the reports.

FTX hailed this crypto winter after leading bailouts

In the mean­time, FTX has been on a pur­chas­ing spree despite the market’s dete­ri­o­ra­tion, with the exchange report­ed­ly acquir­ing a 30% stake in Antho­ny Scaramucci’s Sky­Bridge Capital.

The Sam Bankman-Fried-led com­pa­ny just this year grant­ed bailouts to sev­er­al trou­bled cryp­to com­pa­nies.

For this, he has been hailed the “JPMor­gan” of cryp­tocur­ren­cy, sav­ing cryp­to firms dur­ing this pro­tract­ed cryp­to win­ter. Block­Fi, a cryp­tocur­ren­cy lender, received a $250 mil­lion cred­it from the cryp­to exchange. Cana­di­an cryp­tocur­ren­cy asset trad­ing plat­form Bit­vo was also bought by FTX in June, per reports cit­ed by Be[In]Crypto.

This month, GameStop Corp. and FTX US also announced a part­ner­ship through which more GameStop cus­tomers can access FTX’s com­mu­ni­ty and mar­ket­places for dig­i­tal assets.

With that, Bloomberg claimed in June that FTX was also attempt­ing to acquire Robin­hood, although Bankman-Fried denied the reports. In addi­tion, the exchange also put to rest rumors that it’s look­ing to buy Huo­bi.

How­ev­er, FTX is also gain­ing an edge over its many com­peti­tors amid the cryp­to win­ter. CNBC report­ed last month that the platform’s rev­enue grew from $90 mil­lion in 2020 to $1 bil­lion in 2021. 

Binance a tough competitor

The top cryp­to exchange by vol­ume in the world, Binance, claimed 55.1% of the spot vol­ume mar­ket share in August, accord­ing to Cryp­to­Com­pare research, as top-tier exchanges con­tin­ued to dom­i­nate the market. 

The report not­ed vol­umes for indi­vid­ual exchanges for the last three months, high­light­ing that Binance (Grade AA) was the largest top-tier spot exchange by vol­ume in August, trad­ing $438 bil­lion. This was fol­lowed by Coin­base (Grade AA) trad­ing $58.3B and AAX (Grade BB) trad­ing $54.9B, OKX (Grade BB) trad­ing $53.6B and FTX (Grade A) trad­ing $49.1B.

Accord­ing to sources cit­ed in the Wall Street Jour­nal, the pri­ma­ry bids for the assets of insol­vent cryp­tocur­ren­cy lender Voy­ager Dig­i­tal Ltd. have come from the exchanges FTX and Binance, with the lat­est bid for Binance being rough­ly $50 mil­lion, some­what high­er than the rival bid from FTX.

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