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Binance’s acquisition of FTX will ultimately not happen. World’s largest cryptocurrency exchange by volume announced He abandons opponent’s rescue plans It was announced 24 hours ago. In this
Binance’s acquisition of FTX will ultimately not happen. World’s largest cryptocurrency exchange by volume announced He abandons opponent’s rescue plans It was announced 24 hours ago. In this way, FTX faces a liquidity crisis in a complex situation.
“As a result of the institutional due diligence, as well as the recent news regarding misuse of client funds and alleged US agency investigations, we have decided not to pursue the potential acquisition of FTX,” Binance said in a statement. Wednesday afternoon, the crypto market is shaking.
The exchange, founded and managed by Changpeng Zhao, expressed hope to help FTX, but concluded: problems are beyond your control or ability to help. The decision also came after FTX acknowledged that it couldn’t afford all withdrawals.
Prior to the announcement between Binance and FTX, the latter exchange saw its clients rush to withdraw their investments amid strong rumors of a liquidity crisis and various investigations into possible misuse of funds by US regulators. In 72 hours, as much as $6,000 million slipped from their hands.
Details on how much Binance will pay for FTX have not been made public, but private investors Sam Bankman-Fried have valued the cryptocurrency exchange at $32 billion. Nor are there any details as to what Binance saw in the company’s books to withdraw from the deal.
However, Coindesk has previously stated that the investments are managed by FTX, according to relevant sources. Caused concern among Binance’s senior executives. In this sense, they assured that it would not be an unexpected move for Zhao to decide to step back with the agreement. Finally this happened.
The consequences of the failed purchase are already being felt. The FTX token, FTT, had lost 80% of its value between Monday and Tuesday, corresponding to a loss of 2 billion in one day. This Wednesday, after the announcement, the crash got much worse. The coin fell from $5 to $2.30, or nearly half, and its circulation value dropped to about $340 million.
Other cryptocurrencies were also affected. Bitcoin price dropped 13% this WednesdayIt is trading at just over $15,900. Ether, on the other hand, is down 30% at the time of this writing, coming dangerously close to falling below the $1,000 psychological barrier.
Images: kanchanara | Binance | FTX
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