Binance Walks Away From Deal

Binance Walks Away From Deal

The world’s largest cryptocurrency exchange will not buy the embattled, the third-largest cryptocurrency exchange by today's volume, according to a tweet from the market leader Binance.

Binance was set to purchase for an undisclosed amount, capping off a dramatic week where Binance CEO Changpeng Zhao and FTX CEO Sam Bankman-Fried fired at each other on social media, with Bankman-Fried insisting assets were safe — while reports of paused withdrawals circulated Tuesday morning.

On Nov. 10, Bankman-Fried wrote a 22-tweet thread, detailing what he called a "poor internal labeling of bank-related accounts" that affected his "sense of users' margin." He also said FTX international was affected by this "shitshow" and US-based users can "fully withdraw." 

Reports of withdrawals being processed came out Thursday. withdrawals were reportedly never paused, though some are speculating the transactions may not be what they appear on-chain. 

Bankman-Fried is looking for about $9.4 billion to save FTX, according to Reuters. The reporting follows up on tweets that Bankman-Fried was negotiating a deal with Tron founder Justin Sun, who told his followers that his team was "working around the clock to avert further deterioration."

The price of $FTT, FTX’s native currency, went from $14 to $19 on news of a possible deal, then fell to $5 later in the day Tuesday. It is now $3.45.

On Nov. 5, Zhao announced Binance — which is the top crypto exchange doing more than $39.8 billion Tuesday — was planning to liquidate around $1.5 billion in FTT, FTX’s native currency, as part of “post-exit risk management,” following a report from Coindesk that FTX’s trading firm, Alameda Research, has a balance sheet full of $FTT as its biggest asset.

Bankman-Fried responded to Zhao’s move by saying that “a competitor is trying to go after us with false rumors.”

“FTX is fine. Assets are fine,” he said.

On Tuesday, in the face of a possible company-saving deal, Bankman-Fried’s tone changed, giving a “*huge* thank you” to Zhao for a “user-centric development that benefits the entire industry.” 

Zhao said the deal was part of a "highly dynamic situation, and we are assessing the situation in real time."

"Binance has the discretion to pull out from the deal at any time," Zhao said then. "We expect $FTT to be highly volatile in the coming days as things develop."

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