All dates are Coordinated Universal Time (UTC).Nov. 2 — Reports SBF-founded company held significant amounts of FTTThe saga kicked off on Nov. 2 after
All dates are Coordinated Universal Time (UTC).
Nov. 2 — Reports SBF-founded company held significant amounts of FTT
The saga kicked off on Nov. 2 after reports that a leaked balance sheet from the Sam Bankman-Fried-founded trading firm Alameda Research suggested the company held a significant amount of FTX Token (FTT), the native token of the FTX cryptocurrency exchange.
A large trading firm holding so much of one asset concerned the crypto community and brought questions regarding the relationship between Alameda and FTX.
Nov. 5 — Trackers pick up significant FTT movement to Binance
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.
22,999,999 #FTT (584,818,174 USD) transferred from unknown wallet to #Binancehttps://t.co/Nm2jz9MKW0
— Whale Alert (@whale_alert) November 5, 2022
At the time, the amount was worth around 17% of the FTT circulating supply.
Nov. 6 — Alameda CEO explains the balance sheet
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.”
– the balance sheet breaks out a few of our biggest long positions; we obviously have hedges that aren’t listed
– given the tightening in the crypto credit space this year we’ve returned most of our loans by now— Caroline (@carolinecapital) November 6, 2022
Nov. 6 — Binance moves to liquidate FTT holdings due to ‘recent revelations’
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.
Zhao said Binance held around $2.1 billion equivalent in Binance USD (BUSD) and FTT due to its FTX divestment last year but didn’t clarify Binance’s current FTT holdings.
He added it would sell the tokens in a way that “minimizes market impact”, expecting the token sales to take “a few months to complete.”
As part of Binance’s exit from FTX equity last year, Binance received roughly $2.1 billion USD equivalent in cash (BUSD and FTT). Due to recent revelations that have came to light, we have decided to liquidate any remaining FTT on our books. 1/4
— CZ Binance (@cz_binance) November 6, 2022
He also confirmed the Nov. 5 transfer of nearly 23 million FTT was part of Binance’s liquidation move.
Zhao added later the move was “just post-exit risk management,” and referred to lessons learned from the collapse of Terra Luna Classic (LUNC) and its market impact, as opposed to being caused by a scuffle on Twitter.
Nov. 6 — Alameda CEO offers to buy Binance’s FTT holdings
Shortly after Zhao’s Nov. 6 announcement of Binance liquidating its FTT position, Ellison tweeted to Zhao saying Alameda would “happily buy it all” for $22 per share.
@cz_binance if you’re looking to minimize the market impact on your FTT sales, Alameda will happily buy it all from you today at $22!
— Caroline (@carolinecapital) November 6, 2022
Nov. 7 — FTX ‘bank-run’ begins, exchange addresses sluggish withdrawals
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.
Get your funds out of FTX. This is financial advice.
— Ran Neuner (@cryptomanran) November 6, 2022
Reported data from Nansen on Nov. 7 showed stablecoin outflows on FTX reached $451 million over seven days, and users began to report sluggish withdrawals on FTX with the exchange addressing the withdrawal complaints assuring users everything was running smoothly.
Nov. 7 — SBF says ‘assets are fine’, implores CZ to come together
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.”
Nov. 7 — CZ refuses Alameda’s over-the-counter deal
Responding to a question on Twitter Zhao signaled his disinterest in taking up the deal earlier poised by Ellison to buy Binance’s FTT holdings for $22 per token saying “I think we will stay in the free market.”
I didn’t say that. It was a question, not a commitment. I think we will stay in the free market.
We still hold LUNA (now LUNC) today.
— CZ Binance…
cointelegraph.com