1/ How FTX (a multi billion dollar co) almost died overnight
2/ And why this is a god tier strategic move by @cz_binance
Steph curry, tom brady, they cut huge marketing deals.
SBF becomes the famous “fro of crypto”
(coinbase and others are smaller)
Binance decides to sell it’s stake in FTX.
As part of the buyout, they agreed to take $2B of it in “FTT” — a token that FTX created that it uses for trading fees.
Binance owns a sh*t ton of FTT ($2B)
There’s not a lot of FTT trading volume (this is important soon)
lobbying in a way that would hurt binance
So he announces publicly on twitter to his 7M followers that he’s going to DUMP his entire $2B FTT stash
$2B of sell pressure would crush price
So they start to panic sell
Price of FTT drops like 15-20% overnight.
Nobody wants to buy FTT (too risky, a whale is about to dump) and everyone wants to sell. Number go down.
They are kings.
But news leaks showing the emperor has no clothes
They have ~$12B in assets, $7b ish in liabilities…but half their “assets” are in FTT token
which is plummeting & illiquid
Alemeda might die
They are sorta sister companies. Market makers on FTX. And possibly hold/trade customer deposits. The relationship has been unclear for years. (achilles heel?)
They wait for he or alemeda to show they are in good health
*narrator* but they were not in good health
but it feels to all of crypto like a girlfriend saying “i’m fine”
But something tells us that it’s not so happy, even with the exclamation mark
if they had the financial strength, they would have shown it by now
This starts to feel like the “steady lads” moment right before luna collapsed
Ya know, just in case it collapses like celsius, blockfi, voyager, luna all did in the past year
$1B+ of withdrawals
FTX is facing a liquidity crunch
best code phrase since
“FTX was in trouble. We bought them to save them”
Binance basically started a rumor, made a threat, and ended up buying its biggest competitor overnight.
magnus carlsen approves
crypto crisis averted
if ftx failed…that would have been devestating for all of crypto
you never want to be the main character
more room for tomfoolery in the coming days