BlockFi, a leading crypto lending and trading platform, has announced that it has reached a settlement agreement with Alameda Estates and FTX, two of its former partners and investors. The settlement resolves a legal dispute that arose in July 2021, when Alameda Estates and FTX filed a lawsuit against BlockFi, accusing it of breaching a contract and misappropriating funds.
The lawsuit alleged that BlockFi had violated the terms of a strategic partnership agreement that it had signed with Alameda Estates and FTX in March 2020. The agreement gave Alameda Estates and FTX the right to purchase up to 30% of BlockFi’s equity at a discounted price, as well as access to BlockFi’s proprietary technology and data. In return, Alameda Estates and FTX agreed to provide BlockFi with liquidity, market making, and other services.
However, according to the lawsuit, BlockFi failed to honor its obligations and instead used the funds provided by Alameda Estates and FTX for its own benefit. The lawsuit claimed that BlockFi had diverted the funds to other projects, such as its Bitcoin rewards credit card and its Bitcoin trust fund. The lawsuit also accused BlockFi of withholding information, inflating its valuation, and engaging in unfair competition.
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According to the terms of the settlement, BlockFi will pay $870 million to Alameda Estates and FTX, which represents the full amount of their initial investment plus interest and damages. BlockFi will also transfer back the ownership of some of its assets and intellectual property that were previously acquired by Alameda Estates and FTX. In exchange, Alameda Estates and FTX will drop all claims against BlockFi and release it from any further liability.
BlockFi CEO Zac Prince said in a statement that he was pleased to put this matter behind him and focus on the future of his company. He thanked his customers, employees, and other stakeholders for their support and loyalty throughout the legal process. He also expressed his respect for Alameda Estates and FTX and said that he hoped to collaborate with them again in the future.
Alameda Estates and FTX also issued a joint statement, saying that they were satisfied with the outcome of the settlement and that they wished BlockFi all the best in its endeavors. They said that they remained bullish on the crypto industry and that they would continue to invest in innovative projects and companies.
The settlement marks the end of a long and bitter feud between BlockFi and its former allies, which had caused significant uncertainty and volatility in the crypto market. The lawsuit had also attracted the attention of regulators, who had launched investigations into Block Fi’s business practices and compliance. With the settlement, BlockFi hopes to restore its reputation and regain its momentum in the rapidly growing crypto space.
Pantera Capital is raising funds to purchase a large chunk of SOL tokens from the FTX estate
According to a recent article by Bloomberg, one of the leading cryptocurrency investment firms, Pantera Capital, is in the process of raising funds to acquire a significant stake in SOL, the native token of the Solana blockchain. The deal, which is expected to be worth hundreds of millions of dollars, would involve buying SOL tokens from the FTX estate, the entity that holds the majority of the supply.
Pantera Capital is known for its bullish outlook on the crypto market and its diversified portfolio of digital assets. The firm has invested in several prominent projects, such as Bitcoin, Ethereum, Polkadot, Filecoin, and Uniswap. However, this would be its first major move into the Solana ecosystem, which has been gaining traction as a fast and scalable alternative to Ethereum.
Solana is a high-performance blockchain that claims to offer sub-second finality, low fees, and support for thousands of transactions per second. The network is powered by a novel consensus mechanism called Proof of History, which uses a verifiable timestamp system to order transactions. Solana also supports smart contracts, decentralized applications, and interoperability with other blockchains through the Wormhole bridge.
The FTX estate is the largest holder of SOL tokens, with over 50% of the total supply. The estate was created by the FTX exchange, one of the most popular and innovative platforms for crypto trading and derivatives. FTX has been a key supporter and partner of Solana, launching several products and services on the network, such as Serum, a decentralized exchange; Raydium, an automated market maker; and Solrise Finance, a decentralized asset management platform.
Both Alameda and FTX Estates have significant stakes in the Solana network, as they hold large amounts of SOL tokens, the native currency of Solana. According to some estimates, Alameda alone controls about 20% of the total SOL supply, while FTX Estates has acquired over 10% of the total land supply on Solana.
Some analysts have raised concerns that Alameda and FTX Estates could use their influence and resources to manipulate the price of SOL and other tokens on the Solana chain, either by dumping or pumping them at strategic moments.
They also argue that Alameda and FTX Estates could create artificial scarcity or demand for their own products and services, such as FTX Estates land parcels or FTX exchange listings, by leveraging their access to liquidity and market information.
However, others have countered that Alameda and FTX Estates are actually beneficial for the Solana ecosystem, as they provide valuable support and innovation for the network. They claim that Alameda and FTX Estates are long-term investors in Solana, who have a vested interest in its success and growth.
They also point out that Alameda and FTX Estates have contributed to the development and adoption of Solana, by funding and incubating projects, creating infrastructure and tools, and promoting awareness and education.
The Bloomberg report did not disclose the exact amount or terms of the deal between Pantera Capital and the FTX estate. However, it suggested that the transaction could have a significant impact on the price and liquidity of SOL tokens, which have already surged more than 10,000% since the beginning of the year. At the time of writing, SOL is trading at around $140, with a market capitalization of over $62 billion.