Big takeover in crypto: Binance to acquire FTX?

The second largest cryptocurrency exchange is acquired by by far the biggest player in the space. The drama of the last 48 hours and the happy ending.

A 48-hour drama ended today as Binance Holdings agreed to buy out its most important rival.

- Advertisement -

The sharp turn of events will reshape the more than $1 trillion industry amid potentially prolonged market pressure, Bloomberg points out.

The two sides made the announcement on Twitter at the same time. “To protect users, we have signed a non-binding LOI, intending to fully acquire FTX.com and help address the liquidity crisis,” Changpeng Zhao, CEO of Binance, said in a tweet. Terms were not disclosed.

“A huge thank you to CZ, Binance and all our supporters,” Bankman-Fried, CEO of FTX.com, said on Twitter. “Our teams are working to eliminate delays in withdrawals. This will clear up liquidity issues. All assets will be covered 1:1. This is one of the main reasons we asked Binance to come in.”

Bitcoin reacted bullishly by reaching $20,488. BNB, the token of the Binance blockchain, jumped 15%, erasing previous losses of up to 7.4%.

The tension between Bankman-Fried and Zhao dates back to almost from the beginning. In 2019, Binance invested in FTX, then a derivatives exchange. The following year, Binance released its own crypto derivatives and quickly became the leader in that space.

Tensions grew as the two companies were increasingly seen as different by regulators. Bankman-Fried was testifying to Congress, while Binance, which was said to be facing investigations from regulators around the world, stressed that it was not based anywhere.

- Advertisement -

The drama came to a head on Sunday when Zhao announced that he would sell all holdings of FTT, the FTX token, worth $529 million at the time due to “recent revelations that have come to light”.

The tweet followed a story from CoinDesk that said Alameda Research, a trading house owned by Bankman-Fried, had many of its assets in FTT tokens. The latter reversed an earlier loss of more than 35% to about 19%, and was recently trading at about $18, according to CoinMarketCap.

Binance is by far the largest crypto exchange with a trading volume of around $31 billion so far today. FTX is second in spot transactions, with a volume of about $3.7 billion, according to CoinMarketCap data.

- Advertisement -

CoinMarketCap is owned by Binance.

Previous Articles:

- Advertisement -

Latest

Bitcoin Surges Past $100K as Institutional ETF Inflows Climb

Bitcoin surpassed $100,000 on May 8, coinciding with ongoing inflows into spot Bitcoin ETFs by institutional investors.Major Bitcoin ETFs, including those from ARK 21Shares,...

Ripple Settles SEC Case, Invests $50M in Wellgistics, Faces Lobby Scandal

Ripple reaches a settlement with the SEC, reducing its penalty for XRP institutional sales to $50 million.Ripple invests $50 million in Wellgistics, enabling the...

Trump’s XRP Endorsement Sparks $44B Surge After Lobby Effort

XRP surged 24% and added $44 billion in market value after a post on social media by former President Donald Trump supported the crypto...

Ethereum Soars 28% After Ambitious Pectra Upgrade, Hits $2,400

Ethereum rises over 28% following the Pectra network upgrade and recent international trade developments. The network’s update aims to boost user experience, scalability, and staking...

Radix Opens Token Holder Consultation on 2.4B XRD Reserve Plan

The Radix Foundation is asking token holders for input on repurposing 2.4 billion XRD from its Stablecoin Reserve.Proposals include major funding for ecosystem growth,...

Must Read

Top 10 Best DeFi Tokens to Invest in 2022

Decentralized Finance (Defi), is one of the most talked-about topics in the crypto space alongside NFTs. So if you want to know the best...