On Nov. 7, 2022, Binance planned to sell its entire FTX Token holdings (FTX-USD). FTX Token is a coin that Sam Bankman-Fried issued on the FTX crypto exchange. You will also find the FTX logo advertised on the umpires of Major League Baseball.
The news created a panic for FTX token. It fell by half on Nov. 8. This sell-off ended when Binance’s CEO said that FTX asked for its help. After a significant liquidity crunch, Binance will fully acquire FTX, subject to the usual due diligence in the coming days.
FTX grew even bigger when it acquired troubled crypto platforms this year. Binance posted four tweets, explaining that it received around $2.1 billion. However, “recent revelations” that have come to light led to a liquidation of the remaining FTT on its books. Binance tried to organize the liquidation without disrupting the market.
That failed.
FTX Token traded down to around $15.50 before falling by 21% to $17.78.
Binance’s recent revelation referred to CoinDesk’s assessment of Alameda’s balance sheet. Alameda allegedly held billions of the FTX Token. The close financial connection contradicted their existing as two separate entities.
On Wall Street, stocks like Robinhood (HOOD) and Coinbase (COIN) recovered from earlier losses after Binance announced the purchase.
Be prepared for more volatility in the cryptocurrency space.
