Monday, November 28, 2022

Crypto exchange Binance to acquire rival FTX amid liquidity crunch

Binance tweeted on Tuesday that FTX asked for help and a non-binding letter of intent was signed to help protect users.

• November 8, 2022
Binance, FTX

Global cryptocurrency exchange platform has moved to acquire FTX cryptocurrency exchange after signing a non-binding Letter of Intent (LOI).

“This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to acquire FTX.com and help cover the liquidity crunch fully. We will be conducting a full DD in the coming days,” Binance tweeted on Tuesday.

This move will help to solve FTX’s “liquidity crunch,” according to Binance CEO Changpeng Zhao.  FTX boss Sam Bankman-Fried responded to the news saying that development brings everything come “full circle” as Binance will be the exchange’s first and last investor.  

At the time of filing this report, the acquisition terms have not been disclosed. Binance says it can withdraw from the deal “at any time” as Mr Zhao says that his company will have to do some due diligence before closing the deal.    

Both exchanges have been feuding with one another for a while, with Mr Zhao (CZ) announcing via Twitter on Sunday that his exchange is liquidating all of the FTX tokens (FTT) on its books.

Over the weekend, Mr Zhao tweeted that Binance had decided to offload all of its FTT tokens after speculations around financial difficulties of Alameda Research, the trading firm linked to FTX.         

Bitcoin (BTC) is up by around four per cent after the announcement. The FTX (FTT) token has surged more than 22 per cent, the BNB token is also up 19.58 per cent. 

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