Sam Bankman-Fried, the founder and Chief Executive Officer of FTX Derivatives Exchange has denied that he has plans to bail out some distressed cryptocurrency mining companies.
In a Twitter post over the weekend, Bankman-Fried unveiled that his words that he and the company “aren’t really looking into the space” when he had an interview with Bloomberg last Friday was misinterpreted by the media and crypto Twitter.
er to be clear I said roughly "meh not particularly looking at miners, but sure, happy to have conversations with any companies" https://t.co/liHKS2y06Z
— SBF (@SBF_FTX) July 1, 2022
Most sectors in the digital currency ecosystem are highly distressed as the entire industry has continued to see declining prices stemming from the Central Bank’s responses to inflation, and the aftermath of the Russian invasion of Ukraine. With the combined crypto market cap trading well below the $1 trillion mark for weeks, it shows the prices of key assets like Bitcoin (BTC) and Ethereum (ETH) are taking a very remarkable blow.
These series of events are particularly affecting miners most of whom have been resorting to selling the coins they mine in order to cover the costs of operations and meet their credit obligations.
Call for Bailout from Deep Pocket Players
While a bail-out from rich crypto firms like FTX seems logical, what Sam Bankman-Fried said in the interview was that the prospects of the mining industry cannot be ignored. He also said that he is happy to have a conversation with any company irrespective of the fact that crypto mining does not fall into
The stain in the broader cryptocurrency ecosystem has pushed FTX to extend a $250 million credit facility to BlockFi, and there are options on the table to buy out the company. Morgan Creek Digital is lobbying investors to raise a similarly huge fund to counter FTX’s offer in order not to lose its early investments in BlockFi.
The rush for a bailout is not limited to FTX Exchange alone, as other distressed companies like Celsius Network have been getting offers from the likes of Nexo to bail it out of its current position which its lawyers have been advising filing for a Chapter 11 Bankruptcy.
While is remains unclear whether Sam Bankman-Fried has his eyes on any miner in particular, the general business climate in the crypto space at this time is to see businesses survive the crypto winter no matter how long it lasts.