“We have decided not to proceed with the FTX acquisition transaction. com »Binance explained in a, Wednesday, November 9. The cryptocurrency platform will ultimately not come to the rescue of its rival FTX. com, contrary to what it had previously announced.
“At first our hope was to be able to help FTX customers provide liquidity, but problems are beyond our control or beyond our ability to help”noted Binance.
She mentions the results of an audit, as well as the appearance of press reports about mismanagement of client funds by FTX and investigations by US authorities.
The future of FTX. com, and its founder Sam Bankman-Fried, is now uncertain. The platform needs $8 billion.
Withdrawals not possible
However, FTX was still considered a solid player in the sector until recently. Its founder is a figure in the world of cryptocurrencies, and FTX was valued, during its last fundraising in January, at 32 billion dollars.
But doubts have emerged in recent days about his accounts and his relationship with the Alameda cryptocurrency investment fund, also founded by Sam Bankman-Fried.
On the platform’s help page, the following message was displayed: “FTX is currently unable to process withdrawals. We strongly advise against making deposits. »
This turbulence is shaking the cryptocurrency sector, already scalded in recent months by several bankruptcies and investor preference for less risky assets. Bitcoin fell below $16,000 on Wednesday for the first time in two years.
FTX’s situation deteriorated in a few days. Sam Bankman-Fried had so far called criticism of his company’s financial health a “unsubstantiated rumours” and assured again on Monday: “FTX is fine”. But the platform’s customers heard it differently and started to withdraw their funds en masse. Sam Bankman-Fried then turned to his rival to try to save the furniture.
An astonishing request from this entrepreneur, who until recently was compared to a white knight after offering in June to come to the rescue of companies linked to digital currencies BlockFi and Voyager Digital.
He was also known to regularly lobby politicians in Washington for increased regulation of the cryptocurrency industry.
Binance claimed on Twitter on Wednesday that the cryptocurrency ecosystem is “will strengthen” gradually as “regulatory frameworks will be developed” and that the sector “will continue to move towards greater decentralization”.