FTX-Binance Deal: Everything That's Happened Until Now

On Tuesday, FTX struck a bailout deal with larger rival Binance after a surge in withdrawals caused a "significant liquidity crunch". Concerns about FTX's financial health reportedly triggered $6bn (£5.2bn) of withdrawals in just three days.

The story between cryptocurrency exchanges Binance and FTX has quickly unfolded and caused havoc in the crypto market, here's a breakdown of where it began and where it is now.

A large trading firm holding so much of one asset concerned the crypto community and brought questions regarding the relationship between Alameda and FTX.

On Nov. 5 the Twitter account Whale Alert, which tracks significant on-chain crypto movements, notified its users that nearly 23 million FTT worth over $584.5 million moved onto Binance.

Alameda CEO Caroline Ellison tried to quell any panic in a Nov. 6 tweet saying the leaked balance sheet wasn't reflective of the whole story and noted that sheet, in particular, was only for "a subset of our corporate entities" and other assets worth over $10 billion "aren't reflected there."

Later on Nov. 6, Binance CEO Changpeng "CZ" Zhao said his exchange would liquidate its entire FTT holdings citing "recent revelations that have come to light" believed to be in reference to the Alameda balance sheet.

With reports and rumors swirling, FTX users began to withdraw their funds from the exchange for fear it would go bust, and commentators implored those who hadn't already to get their crypto out of FTX.

Shortly after the exchange addressed user concerns, Bankman-Fried fired off a series of tweets saying a competitor "is trying to go after us with false rumors" and added that "FTX is fine. Assets are fine."

He claimed the exchange has "enough to cover all client holdings", that it doesn't "invest client assets" and has been "processing all withdrawals, and will continue to be."

He claimed FTX had $1 billion in excess cash and called on Zhao to "work together for the ecosystem."

Some analysts began to warn on Nov. 7 of a significant price drawdown of FTT due to the series of announcements and early on Nov. 8 the FTT price dove around 30% to around $15.40 from $22 in a matter of hours.

CZ said shortly after that Binance had signed a nonbinding letter of intent to acquire the exchange, but noted they reserved the right to "pull out from the deal at any time."

Late on Nov. 8, a few hours after announcing the deal with Binance, Bankman-Fried deleted his accusatory tweet thread that also claimed FTX and its assets were "fine."

The crypto market responded to the news with investor sentiment turning fearful with Bitcoin's price hitting a multi-year low of $15,600, analysts expected further downside, suggesting Bitcoin could settle around the $12,000 mark.

FTX's website experienced downtime on Nov. 9 for around two hours and when brought back online, came with a warning strongly advising against depositing and that the exchange was unable to process withdrawals.

In comments to Reuters, the sovereign wealth fund said it was "aware of the developments between FTX and Binance, and are engaging FTX in our capacity as shareholder," avoiding providing further details about the case impacts on its portfolio.