The CEO of Binance declares his intention to buy FTX in order to “help address the liquidity shortage.”
The announcement was dubbed a “user-centric development that benefits the whole industry” by FTX CEO Sam Bankman-Fried.
After Binance CEO Changpeng Zhao said that the business will sell its holdings in FTX Tokens, FTX CEO Sam Bankman-Fried appeared to be trying to dispel reports of a dispute between the two cryptocurrency exchanges on social media.
In response to attempts to reduce its backlog of withdrawals, FTX has “came to an agreement on a strategic deal,” according to a tweet from Bankman-Fried on November 8. In order to “clear off liquidity constraints” and cover assets on a 1:1 basis, SBF said he had urged Binance to intervene.
Binance has repeatedly demonstrated their commitment to a more decentralized global economy while working to strengthen industry relations with regulators, according to SBF. “I know that there have been rumors in the media of conflict between our two exchanges, but Binance has shown that they are committed to both,” SBF said. “We are in very capable hands.”
Zhao made a statement of his own on Twitter, claiming that FTX had asked Binance for assistance on November 8 due to a “severe liquidity shortage.” The deal that SBF was alluding to, according to the CEO of Binance, was a non-binding letter of intent for the large exchange to buy FTX.
This afternoon, FTX requested our assistance. There is a severe money shortage. We signed a non-binding LOI with the intention of fully acquiring https://t.co/BGtFlCmLXB and alleviating the liquidity bottleneck in order to protect consumers. In the upcoming days, we’ll be doing a comprehensive DD.