Fears of a Terra-style debacle have seeped into the crypto market as the Binance-FTX drama continues. Binance CEO CZ made headlines by announcing plans to liquidate entire FTT holdings gradually to avoid any market impact. His crypto exchange had already exited from FTX equity last year.
While CZ clarified that the move should not be taken as an attack on a competitor, this was enough to cause a slew of dumping in the market, and the FTT token shed over 20%.
- To minimize the liquidation’s impact from the sales on the market, Caroline Elison, the CEO of another firm of Sam Bankman-Fried’s crypto empire – Alameda – offered to buy all of the FTT Binance intends to sell for $22 per piece.
- This offer was, however, rejected by CZ, who tweeted,
” I think we will stay in the free market.”
- CZ’s response essentially insinuates that Binance plans to stick with the original goal of liquidating the tokens, which would take a few months to complete.
- Following the liquidation announcement, rumors surrounding Alameda’s balance sheet came to the fore. Reports of the trading firm being overexposed to FTT began circulating this week.
- Shortly thereafter, Nansen data revealed $451 million worth of stablecoins leaving FTX.
- SBF, for one, alleviated concerns regarding potential insolvency, saying FTX has excess cash and confirmed that the client’s funds are safe.
- He also called on Binance CEO to collaborate with him to improve the ecosystem. SBF also accused an unnamed “competitor” of trying to go after FTX with “false rumors.”