FTX, the Bahamas-based cryptocurrency exchange, is in talks with investors to raise up to $1 billion in fresh funding that would see the company maintain its valuation of $32 billion, CNBC reports.
CEO of FTX Sam Bankman-Fried is reportedly negotiating the terms confidentially, though, according to sources familiar with the deal, the terms of the agreement are subject to change. It had initially been reported that the coming investment was to be made as a flat amount that would serve to keep FTX’s valuation in line with the capital raised in January 2022, when the company amassed approximately $400 million. FTX had engaged in two prior fundraising rounds in 2021, raising $420.69 million in October, and $1 billion in July.
Neither FTX nor Sam Bankman-Fried have commented publicly on how the funds from the agreement will be utilized.
FTX’s previous investors include Singapore’s Temasek, SoftBank’s Vision Fund 2, and Tiger Global.
Recent Strategic Moves by FTX
So far in 2022, FTX has been particularly active in acquiring the assets of embattled crypto firms. Most recently, FTX was reported to have submitted one of the highest bids for the assets of bankrupt crypto lender Voyager Digital. The winner of the auction is expected to be announced on, or before Voyager’s next court hearing on September 29th.
In a further noteworthy move this year, FTX obtained authorization from Dubai to conduct digital asset trading and clearing operations in the United Arab Emirates.
It hasn’t all been sunshine and roses for FTX however, and the crypto exchange recently found itself in hot water when the UK’s financial regulator, the Financial Conduct Authority (FCA), issued a warning to consumers against dealing with FTX. The caution letter stated: “We believe this firm may be providing financial services or products in the UK without our authorisation.” It went on to say, “this firm is not authorised by us and is targeting people in the UK. You will not have access to the Financial Ombudsman Service or be protected by the Financial Services Compensation Scheme (FSCS), so you are unlikely to get your money back if things go wrong.”
On the Flipside
Sam Bankman-Fried went on record earlier this year to state that his company has a “few billion” on hand for the purpose of saving failing crypto ventures. The growing empire of FTX-related companies could eventually see Sam Bankman-Fried become a centralized-banker in crypto.
Why You Should Care
FTX has been on a mission to raise funds for some time, with company recording exponential growth throughout the last year. In 2021, FTX saw its annual revenue surge more than 1,000%, shooting up from $89 million in 2020, to $1.02 billion in 2021.
Find out more about regulatory issues surrounding FTX:
UK’s Financial Regulator Issues Warning Against Sam Bankman-Fried’s Crypto Exchange (FTX)
Read more about FTX’s strategic moves:
FTX Emerges As The Highest Bidder In The Voyager Digital Bankruptcy Auction