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Crypto: FTX reportedly looking to buy BlockFi

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Yahoo Finance Live anchors discuss reports that FTX is looking to buy BlockFi.

Video Transcript

BRIAN CHEUNG: Well, let's shift over to another big story, not necessarily for a publicly traded company, but we want to talk about FTX, which is set to buy crypto lender BlockFi. The original report, which dropped yesterday, claimed that BlockFi was being bought out for $25 million. Now, that's a lot of M's, but it is about 99% below the company's last valuations in the B's. However, BlockFi CEO Zac Prince out with a tweet refuting this, saying he can, quote, "100% confirm that we aren't being sold for $25 million," although no clarification, Akiko, on how much higher that figure is supposed to be.

AKIKO FUJITA: Well, and we were talking about this, this morning. Does it matter if it's 99% below the valuation? Or it's--

BRIAN CHEUNG: Or maybe 97.

AKIKO FUJITA: --97%, 95%. The story is that we are starting to see the fallout from the big declines we've seen in the crypto space. And BlockFi is yet another of, what's the word?

BRIAN CHEUNG: Target for--

AKIKO FUJITA: Victim?

BRIAN CHEUNG: Yeah.

AKIKO FUJITA: Victim because they're [INAUDIBLE].

BRIAN CHEUNG: They're going to be fine, yeah.

AKIKO FUJITA: But another target, and again, here comes FTX coming in with the lifeline.

BRIAN CHEUNG: Well, and again, I think the crypto space is experiencing a more accelerated type of downturn than the broader markets, which is already pretty ugly. But you do wonder if this is kind of an example of those companies that do have cash. The haves are going to be able to acquire the have-nots during this cycle, right? FTX, and we know Sam Bankman-Fried is in a very strong position when a lot of crypto projects are not. You just snatch them up.

That's why you have the jokes out there that SBF is effectively the JPEG Morgan of our time. He's the person who's going to be able to come in and throw a lifeline, might be the narrative. But really, what it is, is it's just growing the scale of FTX so that when you do, perhaps, reach the bottom of this, perhaps, coming recession, they're going to be the ones positioned to be the Amazon, to be the Facebook, to be the large whale inside of the crypto space.

AKIKO FUJITA: Yeah, I mean, either way you slice it, I guess, a lot of consolidation expected, with FTX really leading the way there. And we're going to continue to watch that with BlockFi.

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