Binance ditches FTX acquisition plan

Leading crypto asset exchange Binance has dropped its plan to acquire main rival FTX Trading, it announced on November 9.

“As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com,” Binance said on Twitter.

FTX has been appealing to investors for support recently after the price of its FTT tokens dropped amid concerns over the financial health of its affiliate company Alameda Research. 

FTX chief executive Sam Bankman Fried also sought Binance for a bailout, which led to a non-binding agreement by Binance to buy FTX. If realized, it was set to become one of the largest mergers and acquisitions in the crypto asset trading industry.

According to media reports, the US Securities and Exchange Commission is investigating FTX over its crypto lending products and management of customer funds.

The price of FTT continued to fall, and by the evening of November 9 it was hovering around the US$2 level, about half the price of the previous day. The trend of fund outflows also affected the crypto marker as a whole, with the price of bitcoin temporarily falling below US$16,000 following Binance’s announcement.