Hacked Exchange Liquid Global Secures $120M Debt Finance from FTX

2021-09-03 23:51:41 Primitive Reading

Recently hacked Japanese cryptocurrency exchange Liquid Global has secured a $120 million debt financing from Sam Bankman-Fried’s FTX exchange.

According to an official statement by Liquid, the recent funding is part of efforts by both parties to pursue other collaborative opportunities that will contribute immensely to the global cryptocurrency ecosystem.

Seth Melamed, COO of Liquid, said the firm’s joint venture with FTX is vital in delivering top-notch services and innovative products to its customers in Japan and other parts of the world, adding:

“By collaborating with FTX, we see enormous opportunities to drive innovation and change the future of finance with blockchain technology.”

Liquid Regulatory Compliance Pursuit

Under the partnership, FTX’s financial expertise will be combined with Liquid’s efficient regulatory framework, thus helping the parties achieve massive growth in the crypto sector, the announcement states.

Since its launch, Liquid has been serious about regulatory compliance in different locations where its operations are based. It has obtained relevant regulatory approval to solidify its business transparency.

So far, Liquid holds an operational license from the Japan Financial Service Agency (FSA) and the firm is also seeking approval from the Monetary Authority of Singapore (MAS).

“This opportunity with Liquid allows both organizations to strengthen and reinforce the belief that regulation in crypto and knowing your customer is an important part of the future of our industry,” Sam Bankman-Fried, Founder and CEO of FTX, said.

Per the announcement, the fund will be used to solidify Liquid’s capital position, accelerate the company’s capital generation projects, as well as provide liquidity for the exchange.

Furthermore, the funds will be used to enhance the company’s balance sheet, which will, in turn, boost its regulatory metrics to help it obtain necessary approval from global regulatory bodies.

Liquid Loses Over $90M to Hackers

The development comes one week after the Japanese cryptocurrency exchange suffered a devastating hack that targeted its Multiparty Computation (MPC) system of custody.

The exchange disclosed that its warm wallet was compromised leading to the loss of over $90 million worth of Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Tron (TRX), among others.

While the stolen funds are not sufficient to put Liquid’s balance sheet in jeopardy, they will come in handy in providing temporary cover for the current inconveniences.

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