FTX lures blue-chip investors in $421m funding round

Financial Times | Harriet Agnew, Eva Szalay, Joshua Oliver and Arash Massoudi  | Oct 21, 2021

BlackRock, Sequoia and Ontario Teachers’ Pension Plan took part in $421m deal

FTX has agreed a $421m funding round with backing from groups including BlackRock, Sequoia and the Ontario Teachers’ Pension Plan, marking the latest sign that blue-chip investors are warming to digital assets.

The deal values the Bahamas-based cryptocurrency exchange at $25bn, the company said on Thursday, and shows the increasing appetite from traditional investors to back crypto companies despite intensifying regulatory scrutiny into the sector.

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In total, 69 investors participated in the fundraising, including funds managed by BlackRock, Temasek, Tiger Global, Ribbit Capital and Lightspeed Venture Partners, FTX said.

“We are focused on establishing FTX as a trustworthy and innovative exchange by regularly engaging with regulators around the world,” said FTX founder Sam Bankman-Fried.

He said new funds would allow the exchange to expand in new jurisdictions and that its recent growth had allowed it to “partner with investors that prioritise positioning FTX as the world’s most transparent and compliant cryptocurrency exchange”.

Bankman-Fried, a 29-year-old California native who founded FTX in 2019, is now one of the richest people in cryptocurrency markets with an estimated fortune of $8.7bn, due to his earnings from the exchange and from Alameda Research, a crypto market making company he set up in 2017.

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He had previously said that he would be open to major acquisitions in the traditional finance world, once his exchange becomes large enough. He said earlier this year that FTX was on track to make $1bn of profit this year.

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