Binance CEO Denies FTX Conspiracy

A timeline of events leading to Binance agreeing to acquire rival FTX exchange.

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A timeline of events

November 8 at 3am

In line with the recent events concerning the two cryptocurrency giants Binance and FTX, Binance CEO Changpeng ‘CZ” Zhao clarified that their actions towards the FTX token, FTT, is not a move against the rival crypto exchange. 

While it seemed that FTX CEO did not take CZ’s words kindly, asserting that “a competitor” was targeting his exchange with “false rumors.” CZ denied that there is any kind of “conspiracy” against FTX, or that he’s in a “fight” with its CEO Sam Bankman-Fried.

“Sorry to disappoint, but I spend my energy building, not fighting. Today I spent my day on our business & our community. I suggest others do the same. Back to building,” he stated.

Alameda Research Balance Sheet Issue

The word war between the heads of the two crypto giants started from a Coindesk article that analyzed a balance sheet from Alameda Research revealing that the trading firm’s assets are mostly composed of FTX token, FTT. Both the trading firm Alameda Research and crypto exchange FTX are owned by Bankman-Fried.

In response to the “recent revelations that have come to light” about FTX, CZ decided to liquidate the remaining FTT in his and the exchange’s books. Last year, Binance received $2.1 billion FTT and BUSD–its native stablecoin– as part of its exit from an early equity position in FTX since 2019.  (Read more:  Just House Cleaning: Binance To Liquidate Own FTX Tokens)

According to CZ this course of action was “just a post-exit risk management.”

While this might affect the market on a larger scale,  Alameda CEO Caroline Ellison offered to buy Binance  FTT token holdings for $22 each. However, CZ declined Alameda’s bid stating that they will “stay on the free market.”

November 9, 2022 – FTX Acquisition

FTX Acquisition 

The speculation that the two cryptocurrency firms are against each other ended today, November 9, 2022, after CZ announced that Binance has signed a “letter of intent” to acquire FTX Exchange. 

The deal however, is non-binding and Binance has all the discretion to pull out of the deal at any time. (Read more: Binance Signs Deal to Acquire FTX Exchange)

FTX value still crashed

Despite the announcement of the Binance acquisition of FTX Exchange, FTT still went into freefall and lost most of its value, wiping out more than $2 billion in a day. From its $18 value price a day prior FTT is now down to 80% and currently valued at $5.61. (Read more: FTX Token Price Drops 80% as News of Binance Buying FTX Surface)

This article is published on BitPinas: Binance CEO Denies FTX Conspiracy

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.

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