🥛 Hmm.. what's up with this BlockFi x FTX deal?

  • July 5, 2022
  • 3 Min Read

GM. This is the Milk Road. The newsletter that cracks the Piñata so you can eat that sweet, sweet crypto candy.

Friday’s email was the highest-rated of all time 🤯 - if you missed it check it out here. It’s a banger.

Here’s what happened in crypto over the weekend:

  • BlockFi gets a new deal
  • A new crypto phone
  • Bite-sized treats
  • Meme of the day

FTX & BLOCKFI MAKE A NEW DEAL

The bear market has claimed its next victim: BlockFi. 

Let’s recap: 

  • BlockFi was flying high last year - valued at $4.8b
  • The company raised $1.2 Billion (with a B) from investors
  • BlockFi is like a bank. You deposit your money and earn an interest rate. Like Celsius and Anchor, they offered unsustainably high rates to boost growth. 

The high rates drove growth during the bull market - but once the market turned, these companies tanked. 

On Friday, news broke that FTX is stepping up to save BlockFi:

Here’s the deal:

  • FTX gave BlockFi a $400m line of credit to add to their balance sheet
  • FTX now has the option to acquire BlockFi for up to $240m based on “performance triggers”

The CEO claims the total deal consideration could be $680m (which is 95% less than their last valuation) 

Yo Diego! Hit em with the Pawnstars meme:

Jokes aside - this is a good outcome for Blockfi users because it provides a safety net for user funds.

On the other hand…something doesn’t add up:

If you read their announcements…it all sounds so…great! 

If everything is so great, why did you just do this deal?

I’m not saying that they are lying. They could be - but even if they are not, they are clearly trying to spin everything rather than state the obvious - the company was screwed and needed a bailout.

They wouldn’t have taken a deal like this if they weren’t. 

Here at the Milk Road - we like our CEOs to be like a Southwest Airline flight:

Direct, No Bullshit, and with salty snacks.

A NEW CRYPTO PHONE

New trend alert = phones with built-in crypto wallets. 

First, Solana announced they are building a phone. 

Now, Polygon is partnering with HTC to build the HTC Desire 22 phone. 

What is Polygon adding to the phone?

  • Built-in digital wallets. Users will be able to manage their tokens and NFTs on Ethereum & Polygon
  • Virtual reality applications. The apps will offer “rich metaverse experiences without a VR headset”

We only have one question…will all those phones be compatible with our Vitalik phone case?

MAILBAG MONDAY

BREAKING NEWS: We’re bringing back our Milk Road Mailbag segment. 

You can ask us any question (that's right, anything). We’ll pick the best ones and publish our answers. 

Hit reply to this email to submit a question!

TODAY'S NEWSLETTER IS BROUGHT TO YOU BY DELTA

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BITE-SIZED TREATS

DOMINO ALERT: Celsius has recently been in recent financial trouble. The good news? They recently paid off $120m of their debt and have brought their liquidation price down significantly. They look to be in the clear, for now.

Facebook is closing the doors on Novi, their crypto payments wallet. Farewell Novi, we barely knew you. 

Alex Atallah, the co-founder of OpenSea, announces he is stepping away. He’s gonna take some time off but plans to start something new and take it from 0 → 1 again. We sent him a bottle of Milk to enjoy during his time off. 

Raoul Pal has a new company - Science Magic Studios. It’s a digital asset venture studio that helps tokenize some of the largest cultural communities. 

Vauld, a crypto lender, is the most recent company to suspend transactions. Another one bites the dust.

MEME OF THE DAY

🤣🤣🤣

Stay thirsty my friends, see ya tomorrow!

Shaan "Chocolate Milk" PuriBen "2% Milk" Levy &  Diego "El Lechero" Salinas

A Review from the Road...

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.

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    Milk ManWriter

    This dashing dairy expert is not just your average milkman. He's a tri-athlete, a former classmate of Satoshi Nakamoto, and a crypto enthusiast who loves nothing more than delivering the freshest news and insights straight to your inbox.