It had signed a non-binding agreement to acquire FTX amid reports questioning the liquidity of SBF’s crypto exchange and its trading group Alameda.

According to Binance founder Changpeng Zhao, who also goes by CZ, the acquisition is contingent on the results of a due diligence investigation. And it should be noted that the tentatively planned acquisition is only for the operations of FTX.com, which accounts for the non-US operations of the exchange. Bankman-Fried operates a separate US crypto exchange known as FTX.US.

SBF and CZ traded barbs on Twitter over the weekend, as CZ announced that Binance would liquidate any holdings of its cryptocurrency token FTT, FTX, due to “recent revelations.” This essentially set off a chain of events that saw a crash in FTT token price and FTX experience. $6 billion In user withdrawal in a period of 72 hours.

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The disclosures referred to by CZ were primarily the result of reporting coindesk Reporter Ian Allison and an anonymous crypto journalist who pens the newsletter Dirty Bubble Media under the name mike bergerberg, Both reports had access to Alameda’s balance sheet where FTX had apparent liquidity problems with the bulk of its assets in its FTT token. The findings saw Burgersberg explicitly questioning whether the SBF’s empire was in fact bankrupt.

Anonymous Burgersberg has gained notoriety in crypto circles over the past year as one of the first to sound the alarm about crypto lending firms Celsius and Voyager before both companies went bankrupt. And apparently, based on CZ’s own Twitter likes, the Binance founder saw Bergerberg’s report before deciding to cash out FTT as well.

According to reportsJust six weeks ago, FTX was in talks to raise $1 billion at a $32 billion valuation. crypto exchange raised $400 million in January at a valuation of $8 billion. Now, it is being sold in a fire sale to its biggest competitor.

As has become the norm in crypto, the news created a domino effect throughout the industry; Bitcoin Its lowest price since 2020, below $17,500.

It is difficult to tell this story without mentioning that it is happening on election day in the US SBF has become a major donor to the Democratic Party in its efforts to lobby for pro-crypto legislation. at one point, he Mortgage As much as $1 billion for the 2024 elections. And while the SBF spent up to $40 million on most Democratic campaigns through its Protect Our Future PAC, it nice little Of the above $1 billion.

After today’s news, it seems plausible that Democrats shouldn’t count on the remaining $1 billion of SBF coming soon.