Media: Morgan Creek Digital plans to buy a controlling stake in BlockFi

Morgan Creek Digital is trying to raise $250 million from investors to acquire a controlling stakecrypto-landing platform BlockFi. CoinDesk writes about this with reference to the head of the venture capital company, Mark Yusko.

Journalists got hold of a recording of Yusko’s conversation with investors, which took place on June 21. According to the top manager, Morgan Creek's initiative is a response to BlockFi's agreement with the FTX exchange. 

On Tuesday, BlockFi CEO Zach Prince revealed that his company had signed a preliminary $250 million revolving line of credit with FTX.

Later, information appeared in the media about the Bitcoin exchange's plans to acquire a stake in BlockFi. 

Yusko stressed that the original agreementsides allows FTX to buy the landing platform "at virtually zero cost". If the exchange seizes this opportunity, it will “clean up” existing shareholders, including management and employees with securities options, as well as venture capital investors.

In a conversation with CoinDesk, a BlockFi representative noted that the parties have not yet reached a final agreement and are discussing the details of the deal.

According to Yusko, if FTX decides to take overplatform after the credit line is extended, only the largest investors in BlockFi's latest funding round will get at least some of their money back. 

Morgan Creek, which has participated in several investment rounds, will be in a difficult position, he explained.

"The only alternative is to attractequivalent amount of capital, which is what we are working on. I'd say there's a 10% chance of this happening, but not zero. […] It's not over yet, but the situation definitely looks grim,” Jusko said.

He stated that the venture company is not opposed to a joint deal with FTX, where both parties will enter the capital.

Yusko said he has spoken with a potential lead investor who could write a check for $100 million, as well as two other interested parties willing to contribute up to $50 million. 

Recall, on May 25, information appeared in the media about the plans of the Goldman Sachs conglomerate to raise $2 billion to buy the assets of the Celsius Network crypto-lending platform in the event of its bankruptcy.

Read ForkLog bitcoin news in our Telegram - cryptocurrency news, courses and analytics.