After it was revealed that the deal to acquire crypto exchange Binance from competitor FTX, which was in a zone of turmoil due to a massive outflow of investors, had fallen through, FTX CEO Sam Bankman-Fried told employees that he consider all options for the company’s exit from a crisis situation. Although in this case, it’s unlikely that anything will help FTX stay afloat.
Last Sunday, rumors about the unfavorable financial situation of the crypto exchange FTX caused panic among investors, who started withdrawing en masse. About $6 billion was withdrawn from the platform’s accounts in the 72 hours leading up to Tuesday morning, creating a liquidity crisis for FTX and forcing management to seek help from a competitor, crypto exchange Binance. Binance CEO Changpeng Zhao initially agreed to bail out on condition of an FTX acquisition following a due diligence on the platform’s financial health that uncovered a number of issues, as well as related to the upcoming investigation into its Activities of the US Securities and Exchange Commission, went to hell. Binance’s refusal of the transaction led to the collapse of the cryptocurrency market.
According to Bankman-Fried, Binance had not previously placed any conditions on the proposed transaction. “They (Binance) reported this (the rejection of the deal) to the media first, not to us, and did not inform us or provide any terms beforehand.” – said the CEO of FTX in an address to employees in the Slack Messenger. He promised to fight as much as possible for the survival of the company.