Binance is set to acquire FTX – that is the startling news that hit the cryptoverse moments ago.
Changpeng Zhao – or CZ as he is known – tweeted that Binance has been asked for help by FTX as it seeks to staunch the bleeding at the exchange, after Coindesk caught sight of documents earlier this week that indicated that sister company Alameda held the FTT token and not much else on its balance sheet.
Binance made it known that it intended to sell its holding of FTT, although claimed that the move was not related to the balance sheet issues.
That started an old-fashioned run on Alameda, as the price of the FTT token plummeted.
Earlier today the FTX Token was trading at $14.58, down 30% but has tried to recover since the news of the Binance rescue broke.
Sam Bankman-Fried, owner of FTx and Alameda, initially pushed back against claims that FTX was insolvent. On 7 November he tweeted:
That was followed by Alameda CEO Caroline Ellison, saying that the firm would take the FTX tokens off Binance’s hands for $22 a piece.
However, that attempt to put a floor under the price failed, when the price sank below that offer price today.
That seems to have led to a cash crunch at the SBF properties, forcing the founder to reach out to the rival exchange for help, if CZ’s tweet is a correct rendering of the latest developments.
Whatever the exact truth of the matter, the CZ tweet has led to a sharp reversal in crypto prices across the board.
At the time of writing Bitcoin has almost erased its 6% losses, to trade at $20,559 and Ethereum is back above $1,500 at $1,561 in volatile trading.
However it is BNB that is the main beneficiary. The exchange coin is up 13.5% at $386 as traders pile into the asset class.
Both FTT and BNB provide discount and other benefits to traders on the respective exchanges.
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