Binance Set to Liquidate All Its FTT Tokens
Binance Chief Executive Officer, Changpend Zhao, has announced that the crypto exchange will liquidate all its FTT tokens. The decision followed FTX CEO’s comments on regulatory suggestions.
Final Exit
CZ responded through Twitter to Alameda’s published balance sheet. He made it clear that the Binance exchange will be disposing of all FTT still in its possession. The FTT tokens were taken in the first place when CZ exited FTX.
Nevertheless, CZ did not mention the amount of FTT tokens there were to sell. But information on the street says Binance has $2.1 billion worth of FTT and BUSD.
CZ, via his tweets, said Binance received about $2.1 billion worth of FTT and BUSD. This was while the exchange exited FTX last year. He said further that they are liquidating all FTT they have as a result of “recent revelations.”
After the news from CZ, Alameda Research CEO, Caroline Ellison, made an offer to buy from Binance. The offer carried a price tag of $22 per token. Ellison stated that the purchase will also minimize the impact the dump would have had on the market.
She also made the offer via Twitter. It went straight to the point to say if Binance was willing to sell immediately, Alameda will buy.
FTT-Backed Loans Liquidation
But CZ added that the decided liquidation was going to take some months as a result of limited liquidity. And also because of the ongoing bearish market condition. Furthermore, he said the liquidation will be carried out such that liquidations will be minimized.
Despite the statement from Zhao, FTT still dropped by almost 10% in the last 24 hours. It currently trades at $22.
Reports from EtherScan showed that 22,999,999 FTT tokens were moved to Binance on Saturday. The tokens were worth $585 million at that time. The number of tokens moved was equal to almost 17% of the total FTT market supply.
CZ was to later confirm that the shifting funds were part of the exchange’s plan to liquidate its position. He added that the decision was not a shot at the company’s competitors. But users are guessing that such a large dump might have a huge effect on FTT-backed loans.
A Twitter user said it seems CZ is gradually dumping FTT to the tune of $500 million on the market. Many loans backed up by the Alameda token will get liquidated as a result. It will further result in a death spiral, they said.
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