- FTX crypto trade known as on Binance for assist to guard its customers.
- Binance agreed and signed a non-binding letter of intent to accumulate the trade.
- Beforehand, Binance CEO stated they might liquidate their whole FTX token portfolio as a post-exit danger administration technique.
FTX crypto trade has sought probably the most important crypto market participant, Binance, for assist following the trade’s liquidity disaster.
Changpeng Zhao (CZ), the CEO of Binance, posted on Twitter that his group has signed a non-binding letter of intent to accumulate FTX to guard customers from important monetary losses. The newly signed settlement will assist FTX stand agency in opposition to its present liquidity crunch and be capable of honor customers’ withdrawal requests.
Earlier immediately, the worth of FTT, the native token of FTX, plummeted considerably by over 27% as buyers rushed to promote the coin over fears of FTX collapsing. Binance coin (BNB), then again, has appreciated by 12% after CEO Zhao introduced their intent to accumulate the FTX trade.
Yesterday, CZ introduced that his firm would liquidate its whole FTT token portfolio as a post-exit danger administration technique. Binance’s CEO took the monetary determination after an investigative report by a information outlet revealed that FTX’s stability sheet primarily comprises FTT tokens fairly than impartial property like a fiat foreign money or different cryptocurrency.
Analysts declare that the foremost downside with the FTT token is that it has no use and hardly any demand. Consequently, the coin can turn out to be an illiquid asset, endangering buyers’ monetary safety akin to that of Terra LUNA.
Moreover, after deciding to withdraw from FTX fairness final 12 months, Binance obtained round $2.1 billion in compensation within the type of a stablecoin and FTT fairly than a stablecoin alone. The CEO of FTX, Sam Bankman-Fried, allegedly desperately wants to keep up the worth of FTT inflated to proceed luring exterior buyers with elevated values.