Binance US, Coinbase, Curve in Bidding War for BlockFi Credit Card Customers

Blockworks has learnt that Binance US and Coinbase are among the bidders for the BlockFi credit card program and its related clients, while smaller fintech competition Curve is also interested in the approximately 87,500 BlockFi accounts.

BlockFi banned withdrawals on Thursday, November 12, citing a “lack of clarity” on the evolving situation at FTX and Alameda Research, both of which have now initiated bankruptcy proceedings.

Several Twitter users have reported that their BlockFi cards have ceased operating in the last 24 hours.

BlockFi is thought to have a $800 million hole in its balance sheet and is not thought to be significantly involved in the negotiations to buy its card assets.

According to a source close to the situation, a settlement is expected within 72 hours, adding that the majority of the ongoing negotiations over the sale of the BlockFi card assets are being done by the fintech servicing firm Deserve, which manages the BlockFi program. The issuing bank is Evolve Bank & Trust of Florida.

Centralized exchanges vs. “traditional” fintech

A Curve representative in the United States stated that if Curve was successful in securing the customer base, the business expected to continue to give crypto incentives, the signature feature of the BlockFi card. Curve's website lists ten coins for which it provides crypto prizes.

In an emailed statement, they stated, “What distinguishes our bid is that Curve is not a centralized exchange and has no intention of becoming one.” We offer a cryptocurrency rewards credit card and earn money from interchange and interest; we are not attempting to convert credit card customers into exchange customers.

“In fact, in light of what we've all witnessed this week, we will actively urge our consumers to self-custody their incentives.” We want users to earn their incentives in cryptocurrency and then transfer them straight into their personal wallets.

This year has been filled with challenges for BlockFi. The company suffered more than most during the meltdown of Three Arrows Capital and the subsequent collapses of lending rivals Celsius and Voyager, which harmed trust in the crypto lending sector and caused BlockFi's monthly revenue to drop from around $48 million in early this year to just $15 million by August.