Curve plans to acquire BlockFi credit card customers

Tuesday 15 November 2022 15:35 CET | News

Curve, a UK-based payments company, has announced it plans to acquire crypto lender BlockFi’s more than 87,000 credit card customers.

As mentioned by Cointelegraph, the outreach and negotiations started in November 2022 and are still in the process with Banking as a Service (BaaS) company Deserve, which services the BlockFi card program.

Should the acquisition succeed, the fintech is looking to continue BlockFi’s credit card program, noting that customers will still be able to earn crypto rewards. An added benefit of a successful acquisition is that customers from BlockFi’s credit card program will not be ported to another centrally-held exchange.

The bid for BlockFi’s credit card customers comes days after BlockFi announced it was suspending withdrawals, citing the ongoing saga with crypto exchange FTX as the cause. The same day BlockFi credit card users reported their cards were no longer working and had received messages from BlockFi confirming the cards had been suspended because of recent events at BlockFi.

Some users were further antagonised when they received messages from BlockFi informing them they would still be required to keep up with their credit card payments.

What happens with BlockFi?

BlockFi has experienced multiple travails in 2022. The company suffered more than most during the meltdown of Three Arrows Capital and the associated collapses of lending rivals Celsius and Voyager, which undermined trust in the crypto lending sector and caused monthly revenue at BlockFi to fall from around USD 48 million early in 2022 to just USD 15 million by August 2022.

Curve, a UK-based payments company, has announced it plans to acquire crypto lender BlockFi’s more than 87,000 credit card customers.

After this collapse, BlockFi became heavily reliant on FTX, taking a USD 400 million line of credit from FTX US and laying out terms for a potential acquisition by FTX. BlockFi neared its own liquidity crisis over the summer after the Terra-triggered crypto crash.

Because of these, BlockFi decided to pause withdrawals, citing a significant impact from the fallout of FTX’s demise. That means BlockFi users can't get their money out or put money in, at a time when all centralized exchanges and crypto brokers are under the microscope and customer jitters are high.

Updates on FTX

FTX is a cryptocurrency trading firm that, at one time, had been among the largest in the world. However, after facing a liquidity crunch, FTX, its sister firm Alameda Research, and 130 affiliated companies under the banner of FTX Group filed for bankruptcy.

At the heart of the issue is FTX’s native token, FTT, which was eviscerated in a huge sell-off. In a rapid series of events that unfolded largely on Twitter, FTX attempted to sell a large part of its operating business to rival Binance after a wave of withdrawals threatened to take FTX down. But just as quickly as Binance offered its rescue package in the form of an acquisition, the company backed out.

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Keywords: payments , credit card, acquisition, crypto, BaaS
Categories: Banking & Fintech
Companies: BlockFi, Curve
Countries: United Kingdom
This article is part of category

Banking & Fintech




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