Changpeng Zhao, co-founder and CEO of Binance, has sent out an email telling employees of the world’s largest cryptocurrency exchange that he did not “master plan” the events that caused competitor FTX to face a liquidity crunch.
Binance had owned a substantial share of FTT, the native token of US-based FTX. However, Zhao said on Twitter that his company would begin selling off those tokens in light of revelations about the balance sheet of Alameda Research, a trading firm closely linked to FTX.
“We will try to do so in a way that minimizes market impact,” he tweeted.
His message, however, may have had the opposite effect. Zhao’s influence on the social network could have triggered a sell-off that exposed FTX’s poor financial health. This led many to speculate that Zhao orchestrated the events from the start, with the ultimate goal of buying FTX for cheap.
On the other hand, many commentators had pointed to deep-seated issues with FTX’s finances that were primarily to blame for its near-demise.
The internal email that Zhao sent addressed the speculation. He claimed that he had “little knowledge of the internal state of things” at FTX before striking a deal to buy it. “I was surprised when he wanted to talk,” he wrote, referring FTX founder and CEO Sam Bankman-Fried.
Full note below:
See also: Why the FTX collapse is a big deal
Editing by Eileen C. Ang
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