In brief
- FTX US launched a supplemental income pilot program in partnership with the City of Chicago and local organization Equity and Transformation.
- The cryptocurrency exchange announced the news at the grand opening of its Chicago headquarters.
FTX US, the U.S. division of cryptocurrency exchange FTX, opened its new headquarters in Chicago, and announced the creation of a pilot program that provides guaranteed income and other benefits to low-income city residents.
The initiative was revealed today at the headquarters, which is in the Fulton Market district in the city’s West Loop. Chicago Mayor Lori Lightfoot was on hand to cut the ribbon and deliver remarks.
FTX US will work with the city of Chicago and local organization Equity and Transformation (EAT) to sponsor 100 Chicagoans, who will each receive $500 monthly, a no-fee bank account and a Visa debit card through the FTX platform, and financial literacy education. The year-long initiative is set to begin this fall.
The program will support eligible residents from the Austin, Englewood, and West Garfield Park neighborhoods. EAT’s existing Chicago Future Fund program currently supports eligible residents in West Garfield Park. Funds for this initiative will come from the FTX Foundation, which plans to distribute over $100 million to charitable programs in 2022 alone.
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“What this new program initiative has the potential to do is completely transform the lives of residents who are desperate for help,” Lightfoot said at today’s press conference.
She added that fintech and crypto firms like FTX US can “set the stage and challenge the traditional banks and financial lenders to get on board with a new reality,” and that banks and other financial firms charging 20% to 30% fees for services should be a thing of the past.
“Crypto has the ability to advance financial inclusion by reaching and benefiting those who are unbanked, underbanked, or do not use traditional financial services like banks,” Lightfoot added. “In partnership with companies like FTX US, my goal as mayor is to bend the crypto arc towards equity.”
In an interview with Decrypt, FTX US President Brett Harrison said the program will leverage the company’s technology to benefit Chicagoans.
“There are many people, in cities especially, who have been historically disenfranchised from the financial system,” he said. “There are people who don't have either good or potentially any access to traditional banking services. They have to deal with things like overdraft fees, or not being able to understand their balances in real time.”
“Through the technology stack that we've built at FTX,” he continued, “we have an opportunity to be able to provide some of these basic financial services to people at basically no cost.”
Why Chicago?
Harrison already was based in Chicago when he joined FTX US about a year ago, and said that he had the option to join FTX founder and CEO Sam Bankman-Fried in Hong Kong at the time (FTX has since moved operations to the Bahamas). Instead, Harrison began establishing the firm’s U.S. division and footprint in the Windy City.
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“Sam really wanted to establish a U.S. presence to build out the U.S.-regulated suite of companies,” added Harrison. “It was a good fit to just stay here and help build things out, and be around the different exchanges, trading firms, and VCs that are all here in Chicago.”
Harrison believes Chicago can become a major crypto hub in time. Investment firm Jump Crypto is based in the city, Solana Labs has an office, and local trading firms like Cumberland DRW and Chicago Trading Company are into crypto.
“This is a really good place for financial companies to be, period,” he said. “But I think for crypto, specifically, we're gonna see a real growth of companies entering the space through Chicago.”
The FTX US headquarters currently houses 70 employees. In January, the firm raised $400 million at an $8 billion valuation, while parent company FTX was valued at $32 billion following its own latest $400 million raise.
