FTX walked away from a deal with Celsius after seeing state of its finances: sources

Quick Take

  • FTX was interested in making a deal with Celsius but walked away because of the state of its finances, two sources told The Block.
  • Celsius had a $2 billion hole in its balance sheet, one source said.

Crypto exchange operator FTX looked at making a deal with troubled crypto lender Celsius but ultimately walked away, two people with knowledge of the matter told The Block.

FTX began talks with Celsius about providing financial support or making an acquisition but decided against proceeding after looking at Celsius's finances, the sources said. Celsius had a $2 billion hole in its balance sheet and FTX found the company difficult to deal with, one of the sources said.

Celsius did not respond to The Block's request for comment.

Celsius has been fighting for survival since freezing all withdrawals on June 12, citing "extreme market conditions." Clients' funds have remained stuck ever since. Celsius claimed 1.7 million customers and around $12 billion in assets under management in May.

Amid its financial woes, Celsius has remained almost silent. Its last official update was issued on June 19, when the company said its objective "continues to be stabilizing our liquidity and operations. This process will take time."

The Block reported recently that Celsius has appointed Wall Street giant Citigroup to advise on its financial options and the Wall Street Journal said the lender is working with restructuring consultants from advisory firm Alvarez & Marsal.


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Celsius is resisting a Chapter 11 bankruptcy filing — a recommendation from its lawyers — people with knowledge of the situation told The Block earlier this week. The firm has instead been seeking a show of support from users to help win the internal argument against its own legal advisors.

Celsius was founded in 2017 by CEO Alex Mashinsky and grew quickly by promising attractive interest rates to users. The firm won over high-profile investors, including Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) and growth equity firm WestCap. Last year it raised $750 million at a valuation of $3.5 billion.

While FTX decided to walk away from Celsius, the exchange giant is still interested in rival crypto lender BlockFi. As The Block reported yesterday, FTX is seeking to acquire BlockFi outright after providing a $250 million revolving credit facility to the firm.

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Disclaimer: The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.


About Author

Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team members, Yogita has played a pivotal role in breaking numerous stories, exclusives and scoops. With nearly 3,000 articles under her belt, Yogita holds the records as The Block's most-published and most-read author of all time. Prior to joining The Block, Yogita worked at crypto publication CoinDesk and The Economic Times, where she wrote on personal finance. To contact her, email: [email protected]. For her latest work, follow her on X @Yogita_Khatri5.