The FTX crypto exchange saves the Blockfi loan platform

Sam Bankman-Fried has strengthened the stumbling 900 billion dollar crypto industry with its second rescue operation for a battered company for digital assets in just as many weeks.

The 30-year-old CEO of the FTX crypto trading platform granted Blockfi a loan of $ 250 million, he announced on Tuesday. Just last week he also helped the crypto broker Voyager Digital to withdraw from the abyss with a loan of around $ 485 million in cash and bitcoins.

The steps come when the crypto industry tries to restore trust in a time of increasing pressure at the price of digital assets such as Bitcoin, which even brought some of the largest market participants in the industry in distress.

One of the most important principles of cryptocurrencies is their independence of authorities such as central banks. But the billionaire Bankman-Fried builds a central role, similar to the authorities that saved banks in the 2008 financial crisis.

"Sam became the lender of the last instance," said Anatoly Crachilov, Chief Executive of the London Fund Manager Nickel Digital Asset Management.

"If you have concentrated a few clay events at the same time, this could impose the crypto winter for a very long period of time. FTX has the balance sheet to support these companies, and it is in your long-term, justified interest that this ecosystem survives."

The severe decline in prices for digital assets demanded a growing number of victims last month, including StableCoin Terra and his sister token Luna and the Celsius credit platform, which prevented customers from withdrawing their assets to survive. Bitcoin has fallen by about 70 percent since the all -time high last November, and the competing token ether has lost about four fifths of its value.

The loans on Blockfi and Voyager mark an increase in the scope of the support and awareness of companies that need help. At the beginning of last week, the Blockfi loan platform had to dismantle around a fifth of its staff because it cited a "dramatic change in the macroeconomic conditions".

Last week it was also forced to liquidate at least a few positions from Three Arrows after the crypto hedge fund had not met Blockfi's demands to cover its bets on digital currencies.

On Tuesday there was known that there was a revolving credit facility of $ 250 million from FTX, although there were no conditions or the interest rate. Blockfi said that FTX's claims on the facility would be subordinate to all customer credit if Blockfi fails. Bankman-Fried said that Blockfi has no debts or risks from Three Arrows or Celsius.

"Sometimes leadership means acting determined, and that has done that Blockfi did: remove annoying opponents before they become a problem and add cash before it was necessary," Bankman-Fried wrote on Twitter on Tuesday. He added: "Blockfi is financially strong; all operations are normal as they have always been and the assets are safe."

Bankman-Fried added that even in cases where FTX is not involved, he sees an important role in supporting market participants. "I think that's healthy for the ecosystem and I want to do what can help him grow and thrive," he tweeted.

Voyager agreed to a loan facility of $ 200 million in cash and USDC - a popular stable coin in the crypto industry - and a second for 15,000 Bitcoin, which corresponds to about $ 285 million. Both facilities expire at the end of 2024 and have an annual interest of 5 percent.

ZAC Prince, CEO of Blockfi, said that the deal of his company would "give the company access to capital that further strengthens our balance sheet".

"Our team is a campaign test and has survived many storms over the years, which makes us only stronger and more resistant in today's market environment," he added.

With the growth of the crypto industry, large crypto bonds have repeatedly started to save projects or companies that are in trouble.

Last year FTX provided $ 120 million of external financing for liquid, a crypto exchange that lost about $ 90 million of crypto tokens to hackers. FTX later acquired the smaller stock exchange.

At the beginning of this year, Binance, the world's largest crypto exchange, led the rescue operation for Sky Mavis, the company that runs the popular Play-to-Eearn game Axie Infinity, which was hacked with over $ 6 million.

"We are firmly convinced that Sky Mavis will bring a lot of value and growth for the larger industry, and we believe that it is necessary to support you in solving the recent incident," said Changpeng Zhao, CEO of Binance at the time.