Changpeng Zhao “CZ”, the chief executive officer of the cryptocurrency exchange, Binance, announced that his company would completely liquidate its holdings of FTX, the native token of the adversary exchange.
On November 6, CZ tweeted that recent developments were the basis for the company’s liquidation decision. He also stressed that the sale of the company’s tokens could take several months to complete due to the size of its stake.
CZ later tweeted that market participants should view FTT liquidation as “just post-exit risk management”. He suggested that there were important lessons to be learned from the recent Terra Luna Classic (LUNC) catastrophe.
He also said that the corporation would not help individuals who secretly advocate against other industry participants as it is against corporate policy.
The leaked Alameda Research balance sheet prompted cryptocurrency exchange Binance to list the token for sale. Cryptocurrency advocate and investor, Sam Bankman-Fried, formed Alameda Research. According to the company’s financial statements, Alameda has invested billions of dollars in FTX’s token.
Caroline Ellison, the Chief Executive Officer of Alameda Research, stated on Twitter on November 6 that the company’s balance sheet provided only part of the picture as it did not accurately reflect the situation at hand. She explained that it only included some of the corporate entities that make up the business, and other assets worth more than $10 billion are not listed there.
In a tweet, Bankman-Fried supported Ellison’s allegation and stated that many rumors that lacked any basis have been circulating.
Zhao’s Speakings on FTT
While Zhao didn’t specify how much FTT Binance will sell, he did say that the exchange held about USD 2.1 billion equivalent in Binance USD (BUSD) and FTT following its departure from FTX equity last year.
In addition, he mentioned that he believes it would take a few months to finish the token sales and that Binance will attempt to sell the tokens in a manner that “minimizes market impact.”
As part of the token dumping, Zhao confirmed on the blog of the cryptocurrency exchange that almost 23 million FTT, worth approximately $584 million at the time, were moved from a wallet whose location was kept secret to Binance.
The price of FTT swung wildly as a result of the string of announcements, and throughout the course of only two hours, the price jumped from roughly $23 to $24.50, before plummeting by more than 9% to $22.28.
FTT has experienced a loss of over 4.3% in the past day and a half while trading near $22.50.
