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| Crypto giant Binance acquires rival FTX |
Binance, the world's largest cryptocurrency company, has reached an agreement to buy rival cryptocurrency exchange FTX to rescue it from a liquidity crunch for an undisclosed amount.
Binance CEO Zhao Changchang tweeted on Tuesday that the FTX exchange was experiencing a "serious liquidity crisis" and that the company had signed a "non-binding agreement" after the latter requested Binance's help, with the goal of " http://FTX.com to fully takeover .com and help in the process." Dealing with a liquidity crunch.
Zhao added that Binance, which was originally based in China but now claims to have no official headquarters, will do its best to rescue FTX in the coming days and the company can withdraw from trading at any time.
FTX owner Sam Bankman-Fred confirmed the deal in a tweet.
The deal marks the catastrophic collapse of a company valued at $32 billion by private investors earlier this year that hopes to grow into a crypto giant.
A few months ago, Sequoia Capital and BlackRock FTX backed FTX with nearly $25 billion. Forbes estimates Bankman-Fried's net worth at $17 billion, most of which comes from his stake in FTX.
Bankman-Fried told CNBC in September that while FTX is not "immune" from the cryptocurrency decline, it is in a better position than its peers. Because it captures most of the market.
Binance and its founders were among the first investors in FTX, and Bankman-Fried said Binance would be the first and last investor in FTX.com.
It is believed that the acquisition will affect only the arm of the non-US company: FTX.com. US subsidiary: FTX.us will remain independent of Binance, noting that FTX is based in the Bahamas where Bankman-Fried is located.
News of the transaction shows that the value of FTX’s virtual FTT token increased by 26%, while the value of Paynas’ BNB token increased by 20% over the same period.
Zhao said in a tweet that he expected the FT to be "very unstable in the coming days as the situation evolves."
Today, Tuesday, FTX suspended withdrawals from its platform after terrified investors tried to withdraw funds. Investors' confidence was shaken when Zhao tweeted in recent days that the company would sell its stake in FTT.