Binance’s acquisition of FTX.com has sent shockwaves in the crypto space. The event pushed FTX’s native token, FTT, down 71% in the past day to $4.42, according to CoinMarketCap data.
- A shakeup in investor confidence has also driven Bitcoin 6% lower to $18,389, while Ether has sank 11% to $1,300 in the same period.
- According to a Tweet by Binance CEO Changpeng Zhao, the move was to help FTX deal with a ‘significant liquidity crunch.’ Zhao added that the largest crypto exchange by volume – Binance – intends to conduct due diligence in the coming days and fully take over the Sam Bankman-Fried-led company.
The Tension Between Binance And FTX Executives Led Up To The Liquidation Crisis
- SBF and CZ had engaged in a blame game when the latter decided to offload his $529 million stake in FTT. CZ accused SBF for lobbying against other players in the industry. In defense of his crypto exchange, SBF lashed out at Binance CEO for spreading false rumors.
- Although, CZ had stated that the two were not fighting, “Funny memes, media & some people tried to color this as a ‘fight.’ Sorry to disappoint, but I spend my energy building, not fighting.”
- The controversy hit twists and turns when Bankman-Fried announced that FTX.com had entered into a strategic transaction with Binance. He added that the exchange would clear withdrawal backlogs to mitigate any liquidity crunch. The acquisition deal, according to Bankman-Fried, is based on a non-binding letter of intent and does not impact FTX.us.
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