Binance look to buy out Sam Bankman-Fried’s FTX
Binance chief Changpeng Zhao has sensationally announced he has agreed to buy Sam Bankman-Fried’s beleaguered FTX exchange.
The shock move comes barely a day after ‘CZ’ ordered the liquidation of almost $600 million of FTX tokens following arguments with the rival organisation’s founder.
The pair clashed over Bankman-Fried’s comments surrounding how the global cryptocurrency industry should be regulated. The Twitter spat even stirred up rumours of insolvency surrounding SBF’s trading company Alameda Research when leaked accounts showed liabilities worth $8 billion largely made up of unidentified loans.
However, in an unexpected announcement this afternoon, Binance’s 45-year-old boss suddenly declared he was preparing to buy FTX.
“This afternoon, FTX asked for our help,” he said.
“There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire http://FTX.com and help cover the liquidity crunch. We will be conducting a full DD in the coming days.
“There is a lot to cover and will take some time. This is a highly dynamic situation, and we are assessing the situation in real time. Binance has the discretion to pull out from the deal at any time. We expect FTT to be highly volatile in the coming days as things develop.”
FTX chief Sam Bankman-Fried was quick to respond publicly to Binance’s announcment.
“Things have come full circle, and FTX.com’s first, and last, investors are the same: we have come to an agreement on a strategic transaction with Binance for http://FTX.com (pending DD etc.),” he said.
“Our teams are working on clearing out the withdrawal backlog as is. This will clear out liquidity crunches; all assets will be covered 1:1. This is one of the main reasons we’ve asked Binance to come in. It may take a bit to settle etc – we apologise for that. But the important thing is that customers are protected.
“A huge thank you to CZ, Binance, and all of our supporters. This is a user-centric development that benefits the entire industry. CZ has done, and will continue to do, an incredible job of building out the global crypto ecosystem, and creating a freer economic world.
“I know that there have been rumors in media of conflict between our two exchanges, however Binance has shown time and again that they are committed to a more decentralized global economy while working to improve industry relations with regulators. We are in the best of hands.
“(Note that http://FTX.us and http://Binance.us–two separate companies–are not currently impacted by this. http://FTX.us’s withdrawals are and have been live, is fully backed 1:1, and operating normally.)”