Crypto-actives-Binance ready to buy the non-USA activities of its rival FTX

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Posted Nov 8, 2022, 8:11 PM

WASHINGTON/LONDON, Nov 8 (Reuters) – Crypto-asset exchange Binance and rival FTX announced on Tuesday that they have signed a non-binding agreement to buy Binance FTX’s non-US business. United (FTX.com) in order to help it deal with a “cash crisis”, which is bound to trigger new questions about the risks posed by the volatile crypto-asset market for investments.

Changpeng Zhao, the CEO of Binance, said in a tweet that FTX, a company run by billionaire Sam Bankman-Fried, had asked him for help due to a “significant liquidity crisis”.

It was clarified that Binance will proceed in the coming days with the detailed review of the accounts, the next step before a possible acquisition of FTX.com. Binance and FTX operations in the United States are not affected, Bankman-Fried said on Twitter.

“It has been known for a long time that FTX and Binance are in an existential competition. The only surprise today is that things have come to such a conclusion so quickly,” commented Joseph Edwards of Securitize Capital. “The decision will relieve consumers in the short term but raise questions in the long term.”

The cryptocurrency market has already seen several similar bailouts this year, with investors turning their backs on riskier assets in the face of rising interest rates. The cryptocurrency market is now only two-thirds of its peak, reached at more than 1,000 billion dollars.

The deal between Binance and FTX comes as the company’s exchange token FTX (FTT) has lost a third of its value, dragging down other cryptoassets. (Hannah Lang and Tom Wilson, French version Jean-Stéphane Brosse)

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