Binance announced that it intends to fully acquire FTX to help the exchange cover its liquidity crunch.
FTX CEO Sam Bankman-Fried tweeted:
1) Hey all: I have a few announcements to make.
Things have come full circle, and https://t.co/DWPOotRHcX’s first, and last, investors are the same: we have come to an agreement on a strategic transaction with Binance for https://t.co/DWPOotRHcX (pending DD etc.).
— SBF (@SBF_FTX) November 8, 2022
Changpeng Zhao, the CEO of Binance, said on Twitter that FTX approached the exchange looking for help as it was struggling with liquidity on its platform. CZ said that Binance signed a non-binding letter of intent (LOI) to acquire the company in the coming days.
A full due diligence process is expected to be completed in the next few days, as well as more detailed information about the acquisition.
This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire https://t.co/BGtFlCmLXB and help cover the liquidity crunch. We will be conducting a full DD in the coming days.
— CZ 🔶 Binance (@cz_binance) November 8, 2022
“There is a lot to cover and will take some time. This is a highly dynamic situation, and we are assessing the situation in real-time,” CZ said on Twitter. “Binance has the discretion to pull out from the deal at any time. We expect FTT to be highly volatile in the coming days as things develop.”