Binance Has Dropped Its Bid To Acquire FTX Systems, A New York-Based Maker Of Trading Technology
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Binance, the largest crypto exchange by volume, has withdrawn from a deal with the third largest crypto exchange by volume, FTX. On Tuesday, Binance signed a letter of intent to purchase its embattled competitor, FTX, in what appeared to be a bailout of the latter due to a liquidity crunch.
However, only 24 hours later, the plan was quashed. According to a statement given to The Wall Street Journal, Binance backed out of the deal after reviewing the company's structure and books. “Our hope was to be able to provide liquidity to FTX customers, but the issues are beyond our control or ability to assist.”
Binance said. “We have decided not to pursue the potential acquisition of [FTX] as a result of corporate due diligence, as well as the newest news reports regarding mishandled customer funds and alleged U.S. agency investigations,” Binance said in a tweet.
According to Binance, consumers will suffer whenever a large player in an industry fails. We've seen over the last several years that the crypto ecosystem is becoming more resilient, and we believe that outliers that abuse user funds will be eliminated by the free market over time.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 https://t.co/FQ3MIG381f.
— Binance (@binance) November 9, 2022
Binance and FTX did not immediately respond to Media.K.Jwala's requests for comment. Binance and FTX's top brass were reportedly concerned about FTX's loan commitments, according to earlier reports. Changpeng Zhao, the CEO of Binance, tweeted earlier today that FTX's going down 'is not good for anyone in the industry.'
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