Binance has withdrawn from a deal that would rescue FTX just one day after founder Changpeng Zhao signed a non-binding acquisition agreement.
Binance has decided to back out of a deal to acquire FTX.com, according to a statement, just one day after signing a non-binding agreement.
«As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged U.S. agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com,» said a spokesperson for Binance.
«In the beginning, 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.»
Regulatory Probe
According to a «Bloomberg» report citing unnamed sources, US regulators have been investigating whether or not FTX mishandled customer funds, particularly via crypto lending activities.
«Every time a major player in an industry fails, retail consumers will suffer. We have seen over the last several years that the crypto ecosystem is becoming more resilient and we believe in time that outliers that misuse user funds will be weeded out by the free market,» Binance added.
Emergency Funding
Meanwhile, FTX is exploring all options available due resolve its liquidity issues and support the troubled crypto exchange. According to a «Wall Street Journal» report citing unnamed sources, the firm needs emergency funding to cover a shortfall of up to $8 billion due to withdrawal requests in recent days.
«I'm working, as quickly as I can, on next steps here. I wish I could give you all more clarity than I can,» said FTX founder Sam Bankman-Fried in a letter to employees. «I'm deeply sorry that we got into this place, and for my role in it. That’s on me, and me alone, and it sucks, and I'm sorry, not that it makes it any better.»
