Crypto Prices Drop After Binance Scraps Plan to Buy Rival FTX

November 10, 2022 By Jozeph P

(Image Credit Google)

Cryptocurrency prices dropped again for a second straight day after cryptocurrency exchange Binance announced it was abandoning a plan to buy its financially troubled rival FTX Trading. After Binance confirmed rumors and news reports that it was prepared to withdraw from the FTX buyout, which was decided upon by the CEOs of the two exchanges on Tuesday, Bitcoin fell to a two-year low. Following an initial assessment, Binance said in a statement on Wednesday that it had strong reservations that prompted it to call off the transaction. Bitcoin's price dropped more than 13% to $15,840, its lowest level since November 2020, according to CoinDesk. It had a value that exceeded $20,000 at the start of the week. Ethereum, the second-largest cryptocurrency, also experienced a 13% decline. [caption id="attachment_58072" align="aligncenter" width="1600"] Binance CEO

image credit: royalsblue[/caption] As the cryptocurrency market experienced something akin to a bank run, FTX made the decision to sell itself to Binance. As soon as users began to wonder whether FTX had enough capital, they left the exchange, according to AP. Sam Bankman-Fried, the CEO and founder of FTX, was shocked by the sudden sale. Earlier this year, when he assisted numerous bitcoin businesses that were experiencing financial difficulties, he was hailed as a sort of hero. Following the reports, FTT, FTX's cryptocurrency token, dropped by more than 50%. The token was worth ten times as much, or about $2.50, a week ago. According to AP, the main concern among cryptocurrency investors was whether Alameda Research, a partner of FTX, had a balance sheet overloaded with worthless FTT tokens whose aggregate value would not exceed the exchange's liabilities, effectively bankrupting FTX. Hacker steals $570 million worth of crypto tokens from Binance's BNB Chain

Hacker steals $570 million worth of crypto tokens from Binance's BNB Chain

After having the chance to examine FTX's financial records, Binance concluded that the problem was too complicated to be resolved. U.S. authorities are currently looking into FTX for how it handled its customers' deposits, according to Bloomberg and other media outlets. In response to the announcement, shares of publicly traded exchanges with exposure to cryptocurrencies also decreased. Robinhood shares dropped by about 14% while Coinbase shares plunged by over 10%.

By Jozeph P

Journalism explorer, tech Enthusiast. Love to read and write.

Crypto Prices Drop After Binance Scraps Plan to Buy Rival FTX

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