FTX-Binance Saga: FTX Halts Withdrawals, Binance Announces Its Buying FTX.com

Key Takeaways:

  • FTX halted client withdrawals on its platform for some time, before resuming them.
  • Meanwhile, Binance announced that it is buying FTX.com to resolve FTX's liquidity crunch.
FTX-Binance Saga: FTX Halts Withdrawals, Binance Announces Its Buying FTX.com
FTX Halts Withdrawals, Binance Announces Its Buying FTX. Image from pixabay and cryptologos

NEW DELHI (CoinChapter.com) — The tussle between Binance and FTX became a roller coaster ride on Nov 8, with FTX halting withdrawals on its platform and then Binance CEO Changpeng “CZ” Zhao tweeting he was buying FTX.com.

The troubled cryptocurrency exchange suspended client withdrawals when its native token, FTT, tanked after suffering a massive bank run by investors. Per data from Etherscan, there was a gap of nearly 5 hours between transactions on the FTX platform.

The time gap might be an indicator of a halt in withdrawals. Transactions on the Tron and Solana blockchains have been halted as well. However, the transactions resumed later, indicating withdrawals continued on the platform.

FTX investors’ bank run began after Binance’s CEO Changpeng “CZ” Zhao said his firm would liquidate its entire FTT (FTX’s native token) holdings in the coming months. CZ fears the FTX token might collapse like Terra (LUNA) did in May earlier this year.

Binance Buying FTX

Meanwhile, Binance CEO CZ shared a tweet stating FTX had asked for Binance’s help. The world’s largest crypto exchange has reached a deal with FTX to buy the rival crypto exchange for an undisclosed amount.

CZ tweeted that there was a “significant liquidity crunch” at the exchange, likely due to FTX investors’ recent bank run. Binance has signed a “non-binding” Letter of Intent (LOI) to acquire FTX .com fully and “help cover the liquidity crunch.”

Binance CEO CZ announced Binance's decision to acquire FTX.com
Binance CEO CZ announced Binance’s decision to acquire FTX.com

Zhao added that Binance would conduct full diligence in the coming days and that exchange has the discretion to pull out of the deal at any time.

Related: FTX token FTT Price tanks 40%, Amid Binance Controversy

Meanwhile, Sam Bankman-Fried, FTX founder, confirmed the agreement in a series of tweets. SBF noted, “things have come full circle, and http://FTX.com’s first and last investors are the same.”

To recap, Binance was one of the first investors of FTX. The FTX founder stated that teams were working to clear withdrawal backlogs, which would cover the liquidity crunches. Moreover, he assured users that “all assets will be covered 1:1.”

SBF assured users that customer interests are safe.
SBF assured users that customer interests are safe.

Bankman-Fried also thanked Binance CEO CZ and FTX supporters for their support, noting that CZ has done much for “creating a freer economic world.

A *huge* thank you to CZ, Binance, and all of our supporters. This is a user-centric development that benefits the entire industry. CZ has done, and will continue to do, an incredible job of building out the global crypto ecosystem.

Sam Bankman-Fried said in a tweet.

Additionally, the FTX founder stated that media reports of conflict between Binance (CZ) and FTX (SBF himself) were merely rumors. Sam highlighted Binance’s commitment to creating a decentralized global economy, assuring investors they “are in the best of hands.

Meanwhile, the decision does not affect FTX and Binance’s US operations.

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