Global blockchain services provider Binance has signed a non-biding agreement to buy crypto exchange FTX’s non-US assets to help with its liquidity issues.
Binance CEO Changpeng Zhao announced this on Twitter on Tuesday, saying that the deal between the two crypto rivals aims to help cover FTX’s “liquidity crunch”.
Changpeng Zhao Source: LinkedIn
This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire http://FTX.com and help cover the liquidity crunch. We will be conducting a full DD in the coming days.
The acquisition follows FTX’s issues with liquidity came to light and caused a pause in customer withdrawals in the three days leading up to Tuesday morning.
FTX CEO Sam Bankman-Fried had this to say on twitter:
Things have come full circle, and http://FTX.com’s first, and last, investors are the same: we have come to an agreement on a strategic transaction with Binance for http://FTX.com (pending DD etc.).
Bankman-Fried highlighted that the important thing in the situation is that “customers are protected.”
The deal came after rising concerns over problems with FTX’s liquidity after crypto users experienced issues with withdrawals on the platform.
This was then further ignited by Zhao who tweeted on Sunday that Binance would liquidate its holdings of rival’s FTX Tokens (FTT) “due to recent revelations that have come to light.”
Changpeng Zhao said:
As part of Binance’s exit from FTX equity last year, Binance received roughly $2.1 billion USD equivalent in cash (BUSD and FTT). Due to recent revelations that have came to light, we have decided to liquidate any remaining FTT on our books.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.