- FTX is negotiating with investors asking for new rounds of funding of up to $1 billion.
- With its prior financing earlier this year, the company’s valuation is in-line.
- The crypto exchange was reportedly been on an acquisition spree during the ‘crypto meltdown’.
The Bahamian cryptocurrency exchange FTX, led by its CEO Sam Bankman-Fried, was in discussion with investors to reach new funding of up to $1 billion. According to an unnamed informant, the crypto exchange aims to keep its valuation at around $32 billion. However, the people present at the discussion said the talks are still preliminary, and conditions are still unstable.
As per the article published by CNBC, the leaked confidential discussion was provided by ‘sources’, who requested to hide their identity. FTX’s current investors include Singapore’s Temasek, SoftBank’s Vision Fund 2, and Tiger Global.
The sources said FTX’s $400 million capital round from January, along with its newly acquired capital, boosts its capability to negotiate. Also, FTX was on a mission to acquire troubled companies and assets that were greatly affected by the crypto meltdown. These include BlockFi, Bithumb, Robinhood, and Voyager Digital.
Last year, FTX’s income pumped more than 1,000%, up to a whopping $1.02 billion from $89 million in 2020, as per a leaked investor deck published by CNBC last month. The crypto exchange’s net income reached $388 million in 2021, $17 million more than its previous year. The financials also showed FTX’s big first quarter jump at around $270 million in revenue.
However, FTX’s streak ended by the second quarter as crypto was affected by high inflation and rising interest rate hikes. Consequently, this forced investors to leave risky assets, including crypto. By the start of April, both the top cryptocurrencies, Bitcoin and Ether are down by more than 60%.
Bankman-Fried, upon his efforts to continuously raise money, said crypto will bounce back. Moreover, he’ll be taking a big chunk of profits when that happened, he said.
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