Binance recently announced it will be acquiring Billionaire Sam Bankman-Fried’s FTX exchange after years of rivalry between the two. Following the news, Bitcoin, FTT, and the rest of the crypto market crashed to an all-time low.
Just when the market was finally picking up, CZ came along to announce the biggest event of the year. Before this, he came on Twitter to share that he would be selling FTT tokens as part of a deal. After that, the news of Binance buying FTX surfaced and CZ admitted to this.
According to Changpeng Zhao, the “liquidity crunch” exists within FTX, so the exchange will decide to buy it at a non-disclosure amount.
“Binance has the discretion to pull out from the deal at any time. We expect FTT to be highly volatile in the coming days as things develop,”
he said.
This announcement came as a surprise to the community because Bankman-Fried has constantly claimed that the exchange had a huge amount of reserves. He, himself, is a billionaire because of his ventures and the successful exchange. However, the news of liquidity caught everyone off guard.
With the news, FTX halted its crypto withdrawals, and its FTT token dropped 72%. This is the lowest drop for any coin this year after LUNA/UST. Compared to that, Binance climbed 10% as investors poured their money as the acquisition is still pending.
Later, Bankman-Fried came on Twitter to share that FTX has agreed to a “strategic transaction” with Binance. Regarding the liquidity issues, he shared that the team is “clearing out the withdrawal backlog” but it will take time to settle the chaos and the exchange will seek Binance’s help for it.
Crypto market in turmoil
The crypto crash has taken place again and this time the two largest exchanges in the world caused it. For FTT token holders, this market might be a hard time because the coin is constantly dropping.
Since these two tokens were a major part of the crypto market, Bitcoin and other altcoins also dropped. BTC fell to a 23-month low of $17k.The market is in massive distress and volatility. Currently, BTC trades at $18,393 in a bearish pattern.
FTX’s FTT token dropped 79% and is currently at $4.54 with a high of $19.51. This is a huge gap between the resistance and support levels, showing big volatility.
Compared to that, the BNB coin maintained its price and only dropped 0.79%. Other crypto coins also saw a decrease in prices: ETH -11.75%, MATIC -11.07%, SOL -23.50%, DOT -4.38%, DOGE -12.66%, and APT -21.85%, based on CoinMarketCap data.
Final words
There’s still a lot of unsettlement in the market, Binance is yet to decide whether it will buy the exchange or not. Investors are still waiting for both companies to make the decision before they officially announce the future proceedings. Will Binance buy FTX? That’s the question everyone is anxiously waiting to be answered.
