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Crypto in Meltdown After FTX Collapse: Will Binance Be the Saviour?

CZ made a significant step, and now history may be in the making as Binance prepares to acquire FTX, however, this may or may not really happen.

Following the announcement by the CEO of Binance, Changpeng Zhao, that the decision would be made to liquidate FTT, the native FTX coin, all eyes are focused on Sam Bankman-Fried and his business, Alameda Research. Because of this, 529 million FTT will be put up for auction over the course of the next several months.

The erstwhile millionaire found himself in an even more precarious position when suspicions of concealed bankruptcy made news and investors began abandoning their assets from the exchange. This is because the possibility of an FTT crash is quite real.

It’s Possible That Binance Will Acquire FTX.

The unexpected turn of events came to a head when the CEO of Binance, Changpeng Zhao, revealed that Binance Holdings had entered into a non-binding agreement to buy FTX.com. The roller coaster drama had been going on for the previous 48 hours.

According to the official account maintained by CZ, Binance has reportedly issued a letter of intent (LOI) to expedite the purchase.

After Bankman-Fried claimed the successful completion of “an agreement on a strategic deal with Binance,” CZ made their statement shortly afterward. The conflict between these two billionaires is now coming to a head, with Binance seeming to emerge victorious.

Both Bankman-Fried and the CEO of Binance have the same goal in mind, which is to keep their customers safe.

Analysts who had been paying attention over the course of the last few days thought that FTX and Alameda had engaged in questionable business activities in relation to the LUNA disaster and the string of purchases that were tied to the tragedy.

A Too-High Number of Recent Acquisitions

According to reports, the private balance statement of Alameda Research that was made public last week lit a fire under the FTX empire. The chief executive officer of Binance stepped in and used some trading trickery, which ultimately resulted in the leading cryptocurrency exchange, Bankman-Fried, giving in.

The prospect of FTX experiencing a liquidity problem has not yet been ruled out, but the manner in which its CEO has handled the issue has rendered the perceived vulnerability irrelevant.

Many people are of the opinion that if FTX had followed the same road as LUNA, there would have been a larger domino effect, which would have resulted in the market returning to its previous state of chaos. From what we have gathered, it seems that this scenario is no longer a possibility.

The Repercussions.

The mood between the two sides gradually returned to one of calm after an unexpected outburst of tension that occurred between the two important exchanges. However, the turbulence caused by the bolt caused enormous selloffs.

According to CoinMarketCap, the value of the most prominent digital currency in the world, Bitcoin (BTC), decreased by more than 10% to about $18,300. In the early part of the day, the price of Bitcoin dropped to $17,300.80, which was its lowest point since November 2020.

After reaching a low of $1,228.89 on November 8, the price of Ethereum, the second biggest digital currency, plummeted a further 10% to settle at $1,300. In addition, the prices of hundreds of other cryptocurrencies also fell, indicating that investor mood is fragile.

Beginning or End?

Some of the smallest crypto assets that were associated with Alameda, the trading business that is also controlled by FTX CEO Sam Bankman-Fried, have seen some of the largest losses as a result of the general downturn throughout the market.

The value of the FTX token, also known as FTT and the native token of the FTX exchange, dropped by 76.4%. The value of the token that was linked to the Alameda-backed Solana (SOL) dropped by 26.4%.

Sam Bankman-Fried, the CEO of FTX, said that the company has seen more than $6 billion taken out of the exchange in the last three days, and that withdrawals would continue to be halted for the foreseeable future.

Sam Bankman-Fried lost more than 90% of his money in a single night’s worth of turmoil, which resulted in the loss of his status as a billionaire.

The current overall net worth of the FTX chief is around $990 million, according to the most recent figures from the Bloomberg Billionaire Index. This is a significant decrease when compared to the prior value of $16 billion.

When Sam Bankman-Fried made rescue arrangements to bail out distressed lenders during the bear market for cryptocurrencies, he earned the reputation of being the “white knight” of the cryptocurrency sector.

In June, the creator of FTX issued a warning that several cryptocurrency exchanges were in the process of covertly collapsing, and he meant it literally.

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