Binance nixes mooted FTX acquisition deal
The mooted acquisition deal between crypto exchanges Binance and FTX has fallen through just days after it was initially proposed.
Binance pulls out of potential FTX acquisition
Announcing the news on Twitter, Binance, the world’s largest crypto exchange, says: “As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com.”
Reuters reports that the US Securities and Exchange Commission (SEC) is investigating FTX’s handling of customer funds and its crypto-lending activities.
Earlier this week, Binance CEO Changpeng ‘CZ’ Zhao tweeted that his firm had signed a non-binding letter of intent to acquire FTX to help protect users’ holdings amid a “liquidity crunch”.
“This is a highly dynamic situation, and we are assessing the situation in real time,” CZ said. “Binance has the discretion to pull out from the deal at any time.”
Prior to the deal, media reports suggest FTX had experienced $6 billion worth of withdrawals in three days and was struggling to keep up.
At time of writing, a notice on the firm’s website reads: “FTX is currently unable to process withdrawals. We strongly advise against depositing.”
Writing on Twitter, Binance says: “Our hope was to be able to support FTX’s customers to provide liquidity, but the issues are beyond our control or ability to help.
“Every time a major player in an industry fails, retail consumers will suffer.”
