Online Investing Platform BnkToTheFuture Drops Plan to Acquire Crypto Lender Salt Lending Due to FTX Exposure
Salt Lending said it had halted all deposits and withdrawals on its platform.
Nov 15, 2022 at 8:54 p.m. UTC:format(webp)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/VHDOYJPPXFFQTGR3ZQH7CD3ZWA.jpg)
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The crypto contagion that was ignited by the collapse of FTX has claimed another victim: crypto lender Salt Lending. Online investing platform Bnk To The Future said it terminated its previously announced non-binding letter of intent to buy Salt Lending due to the latter's FTX exposure.
"Bnk To The Future announces that its previously announced non-binding letter of intent with SALT Blockchain, Inc. (SALT) has terminated due to SALT’s position with FTX and for failing Bnk To The Future Due Diligence, and that the transactions contemplated thereby will not proceed," according to a statement. "Bnk To The Future has no impact from neither Salt nor FTX as Bnk To The Future has no direct or indirect connection with SALT or FTX and all client funds are fully segregated and uninvested," the statement added.
On Sept. 2, Bnk To The Future said that it had agreed to buy Salt Lending for an undisclosed amount in order to give users the ability to borrow against their crypto holdings. The deal was contingent upon signing definitive agreements and obtaining regulatory approvals.
Salt is the latest crypto lender to get caught up in the FTX implosion that started with a CoinDesk report that raised questions about the balance sheet of trading firm Alameda Research, FTX's sister company. Most recently, crypto lender BlockFi said it had paused customer withdrawals and was reported to be preparing to file for bankruptcy.
Salt earlier had sent an email to its customers that it was pausing deposits and withdrawals on its platform due to the impact on its business from the collapse of FTX, according to a tweet by YouTuber Tiffany Fong. The memo didn't indicate how much exposure Salt had, but said that customers' loans will remain active and all loan monitoring systems will be fully operational.
In a separate tweet, Salt's CEO Shawn Owen replied to a thread stating that "we are fully committed still to recover from the damages as [victims]." Salt, founded in 2016 and based in Denver, was one of the first entrants into the crypto lending arena, predating companies such Celsius and BlockFi.
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Aoyon Ashraf is managing editor with more than a decade of experience in covering equity markets