Binance to liquidate its entire FTX Token holdings after ‘recent revelations’

CEO of cryptocurrency exchange Binance, Changpeng “CZ” Zhao, said his company will liquidate its entire position in FTX Token (FTT), the native token of rival exchange FTX.

In a November 6 TweeterZhao said the decision was made after “recent revelations that have come to light”.

In a later tweet, CZ explained that the FTT liquidation was “just post-release risk management” referring to lessons learned from the fall of Terra Luna Classic (LUNC) and its impact on the cast. of the market.

He also added “we will not support people who lobby against other industry players behind their backs.”

Cointelegraph understands that Binance’s decision to liquidate the token is due to reports regarding a recently disclosed balance sheet from Alameda Research, founded by Sam Bankman-Fried, which alleges billions of dollars in Alameda assets are tied to the token. from FTX.

Alameda Research CEO Caroline Ellison in a Nov. 6 tweet, however, said the balance sheet did not reflect the true story, noting that the balance sheet in question only relates to a “subset of our corporate entities.” and other assets worth more than $10 billion” are not reflected there.

Bankman-Fried backed Ellison’s claim in a Tweeterclaiming that a “lot of unfounded rumors have been circulating”.

Cointelegraph contacted Binance for clarification on the reasons for the liquidation, a spokesperson said the company had no further updates “at this time”.

Related: Bankman-Fried Fools Regulators By Hijacking Centralized Finance

Zhao did not specify how much FTT Binance would sell, but did reveal that the exchange holds around US$2.1 billion equivalent in Binance USD (BUSD) – the exchange stablecoin – and FTT due to its exit from the stock. FTX last year.

He added that Binance would try to sell the tokens in a way that “minimizes the impact on the market,” saying he expects token sales to take “a few months to complete.”

On-chain analysis showed nearly 23 million FTT worth approximately $584 million at the time transferred from an unknown wallet to Binance, which Zhao confirmed as part of the token offload from the exchange.

FTT price swirled on the series of announcements and in the space of two hours in November, it sent the price up from around $23 to $24.50, followed by a collapse of more than 9% at $22.28. FTT is down more than 4.3% in the last 24 hours, trading around $22.50.

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