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Binance backs out of the deal to acquire rival FTX


Cryptocurrency

 Binance backs out of the deal

Binance, the world’s largest crypto exchange by volume, said it would back out of a deal with FTX, the third largest crypto exchange by volume.

On Tuesday, November 8th, 2022, Binance signed a letter of intent to acquire its embattled competitor, FTX, in what appeared to be a potential bailout of the latter amid a liquidity crisis. But just a little over 24 hours later, that plan crumbled.

Binance backed out after reviewing the firm’s books and structure, it said in a statement to the Wall Street Journal. Binance said that it hoped to be able to support FTX’s customers to provide liquidity, but the issues were beyond its control or ability to help.

In a tweet, Binance said as a result of corporate due diligence, and the latest news reports regarding mishandled customer funds and alleged US agency investigations, the cryptocurrency exchange decide that they will not pursue the potential acquisition of FTX.

Binance added that every time a major player in an industry falls, retail customers suffered. Binance continued in the tweet that they have seen over the last several years that the crypto ecosystem is becoming more resilient and they believe in time that outliers that misuse user funds will be weeded out by the market.


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