'FTX is fine,' Bankman-Fried insists as he appeals for Binance to work together

Quick Take

  • FTX CEO Sam Bankman-Fried insisted his crypto exchange is “fine” after rival Binance announced it would start selling its holdings of FTX’s FTT token. 
  • He also called on Binance and FTX to “work together for the ecosystem.”

FTX CEO Sam Bankman-Fried insisted his crypto exchange is "fine" after rival Binance announced it would start selling its holdings of FTX's FTT token. 

"A competitor is trying to go after us with false rumors," Bankman-Fried tweeted. "FTX is fine. Assets are fine. FTX has enough to cover all client holdings. We don't invest client assets (even in treasuries). We have been processing all withdrawals, and will continue to be."

Tensions between Binance and FTX, two of the largest crypto exchanges, have burst into the open in recent weeks. After Bankman-Fried drew criticism from some in the industry last month for a blog post that proposed regulations for websites facilitating trading on decentralized exchanges, Binance CEO Changpeng "CZ" Zhao — a fellow crypto billionaire — weighed in over the weekend.

On Sunday, Zhao had said his firm would begin selling off its FTT holdings "due to recent revelations that have came to light." His announcement came after a Nov. 2 CoinDesk report leaked balance sheet details from FTX's sister trading firm Alameda Research, which listed $3.66 billion in "unlocked FTT" and $2.16 billion worth of "FTT collateral." The leaked balance sheet showed a total of $14.6 billion in assets and some $8 billion in liabilities, which include $7.4 billion worth of loans.

Alameda response

Alameda CEO Caroline Ellison responded that the leaked balance sheet was only partially complete and missed billions of dollars worth of other assets. She also offered to buy Binance’s FTT holdings at $22 per token.

Bankman-Fried finished his four-tweet thread with a barb at Zhao, saying "I'd love it, @cz_binance, if we could work together for the ecosystem."

FTX has recorded a surge in stablecoin outflows following the announcement from Binance. In the last seven days, more than $451 million in stablecoins has left the exchange, according to Nansen data, caused by a flurry of large withdrawals from users. Nansen tracks wallets that it estimates belong to FTX based on on-chain data.

FTT's price has fallen 4% over the past 24 hours to $22.31, according to CoinGecko data. 

Binance co-founder Yi He tweeted on Monday that the company is not in "a war" with FTX and the call to sell FTT was a "pure investment-related exit decision,"

"We have no intention to engage in drama," she concluded. 

Update: Story updated with background to the dispute and comments from Yi He. 


© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.