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Binance acquires FTX in a bid to save its users

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The exchange Binance has acquired FTX.com in an effort to prevent the platform’s users from being affected by the liquidity crisis.. The deal is not final, so Binance could back out at any time.

A few hours ago, Changpeng Zhao (CZ), chief executive officer of Binance, said. announced on his personal Twitter feed the purchase of cryptocurrency exchange platform FTX.com by Binance.. Both parties reportedly signed a letter of intent (LOI) with the aim of helping to cover the liquidity crisis suffered by the American platform.

With this agreement, both parties are trying to avoid a total collapse on the platform.. Such a collapse could cause FTX users’ balances to be blocked indefinitely.

Sam Bankman-FriedFTX CEO Sam Bankman-Fried also took to his personal Twitter to announce the agreement with CZ and Binance. He called the agreement a “strategic transaction” with the aim of protect its customers. Bankman-Fried also reinforced what CZ said, saying that for the time being this is a letter of intent and that in the coming days, if all goes well, the agreement will be described in a full contract.

Binance reserves the right to withdraw from the agreement at any time.in case conditions are not optimal for them. CZ added the following: “.There is a lot to cover and it will take some time. This is a very dynamic situation, which we are evaluating in real time.“. If the agreement is concluded, Binance will cover customer depositswhile teams from both exchanges would work to restore withdrawals to all users.

What happened to FTX?

Last 6th, Binance revealed that he was in the process of divesting Of all its holdings of FTT tokens.the native asset of the FTX exchange. Binance held an amount equivalent to 2.1 billion in assetswhich they decided to dispose of because of a leak that put on the table a possible FTX’s lack of solvency..

Binance had decided to make this move so as to affect the market as little as possible, even taking several months to complete, but this was not the case. The news threw the community into a panic, The result has been a massive sell-off of the asset in recent days.

These sell-offs have caused the price of the FTT to plummet, driving it down to the 9.25 today, a drop of more than 60 percent from $22.3 about 7 days ago.. The value of the asset has fallen nearly another 60 percent in the past 24 hours, peaking negatively around the time of the announcement of the deal with Binance.

Initially, Sam Bankman-Fried accused Binance and its team of acting to harm one of its major competitors. With the new agreement, this thinking may have been reinforced: the only solution to FTX’s solvency problems is to turn to Binance.

It is expected that more information about the situation and the possible agreement will be made available in the coming days or hours. Bitcoin.co.uk will continue to keep you updated as new information becomes available. In the meantime, you can continue reading about the 50,000 BTC intercepted by US linked to Deep Web scams..

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