Just House Cleaning: Binance To Liquidate Own FTX Tokens

Editing by Nathaniel Cajuday 

In response to the revealed FTX Token (FTT)-packed balance sheet of Alameda, Changpeng “CZ” Zhao, the CEO of the crypto exchange giant Binance, announced that he will liquidate the remaining FTT in his and the exchange’s portfolio. 

FTT is the utility token of the crypto exchange FTX, one of Binance’s rivals, that is owned by Sam Bankman-Fried, the billionaire who also owns the now-controversial trading firm Almeda Research which was revealed to have the majority of its assets be the coin of its sister company.

In a Coindesk article, they noted how “Bankman-Fried’s trading giant Alameda rests on a foundation largely made up of a coin that a sister company invented, not an independent asset like a fiat currency or another crypto. The situation adds to evidence that the ties between FTX and Alameda are unusually close.”

Although the CEO did not actually disclose how much FTT they hold, Binance received a total of $2.1 billion–a mix of FTT and its stablecoin native BUSD–as part of its exit last year from an early equity position in FTX it had since 2019. 

With large sums at stake that may affect the prices of coins, CZ assured that they will sell their tokens “in a way that minimizes market impact,” citing the market’s conditions and limited liquidity, with the liquidation to be completed in a few months.

To address the possible market effect, Alameda CEO Caroline Ellison offered to buy Binance  FTT token holdings for $22 each.

She also debunked the fragile financial foundation allegation of Alameda Research saying that its financial condition is stronger than the balance sheet, the document only represents just a part of its assets, is showing, and assuring the public that there is still $10 billion worth of assets that are not reflected in the sheet.

While some commented that CZ might be just “taking revenge” or “teaching Bankman-Fried a lesson,” CZ said that their action was “just a post-exit risk management.”

“Regarding any speculation as to whether this is a move against a competitor, it is not. Our industry is in its nascency and every time a project publicly fails it hurts every user and every platform,” he stated.

On the other hand, Bankman-Fried thanked their users for their continued support and for staying “level-headed during crazy times.”

“And in the end, you should do what you want, and trade where you want.  We’re grateful to those who stay, and when this blows over we’ll welcome everyone else back,” he wrote in a tweet.

As of writing, FTT’s value is at $22.13, or ₱1,296.65. 

This article is published on BitPinas: Just House Cleaning: Binance To Liquidate Own FTX Tokens

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