In a bizarre development that would make crypto Twitter wonder if the feud was just for show, FTX CEO Sam Bankman-Fried and Binance CEO Changpeng Zhao both announced on Twitter this morning that the two crypto exchange platforms signed a non-binding letter of intent for Binance to acquire FTX.
This is just after a little more than two days ago, the two crypto moguls were trading shade on twitter after Binance decide to liquidate all its remaining FTT tokens.
In his tweet, Zhao relayed that FTX asked for their help related to a “significant liquidity crunch.” In his version, Bankman-Fried acknowledged that “things have come full circle” following the reported acquisition plan.
The FTX chief also admitted that the platform is working on withdrawal backlogs, which probably contributed to why withdrawals on the exchange have been reportedly paused. He also cited the same “liquidity crunches” that needed to be addressed.
However, Bankman-Fried clarified that the two separate companies “are not currently impacted by this.” He assured that FTX withdrawals are and have been live… “and operating normally.”
Zhao added that he expects “FTT to be highly volatile in the coming days as things develop.” The digital assets value sharply rose following the news, a quick recovery from how it slumped in the past few days to levels not seen before since January 2021.
The spat between the two seemingly started with a report claiming FTX’s sister hedge fund, Alameda Research, is insolvent.
The document allegedly showed that out of the hedge fund’s $14.6 billion in total assets, $5.8 billion is tied to FTT tokens–FTX’s own digital asset. Hundreds of millions are also believed to be comprised of the fund’s holdings in Serum (SRM), Oxygen (OXY), MAPS, and FIDA tokens–all of which are connected to Bankman-Fried in one form or another.
“The FTT token on Alameda’s balance sheet is roughly 1/3 of their total assets and equal to 88% of Alameda’s net equity. In other words, the firm’s largest asset is a crypto token issued by SBF’s other company, with a very significant portion of their assets in tokens issued by other related parties,” the report by a website called Dirty Bubble Media wrote.
Bankman-Fried, in his recent thread, thanked Zhao and Binance for the “user-centric development” but also acknowledged that “Binance has shown time and again that they are committed to a more decentralized global economy.”
Zhao, on the other hand, included in his tweet announcement of the acquisition deal that Binance has the option “to pull out from the deal at any time.”
The FTX chief added that he is aware of “rumors in media of conflict between our two exchanges,” and seemingly downplaying it. The FTX CEO also assured that with Binance’s pending acquisition, “we are in the best of hands.”
Crypto twitter–especially those who followed the “feud”–is having a field day on this recent development.
Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.