Binance Withdraws from FTX Agreement, Claims Misuse of Consumer Funds

Binance Withdraws from FTX Agreement, Claims Misuse of Consumer Funds

FTX

The agreement between crypto firms Binance and FTX has reached a hitch, as Binance has withdrawn from an offer to acquire its rival, a Binance representative said. 

The two companies, which were previously two competing cryptocurrency platforms that support various industries, including casinos and sports betting, were at odds over the sale of FTT tokens, which were issued by FTX, amid a market-wide collapse for the cryptocurrency industry. It was followed by FTX, indicating that it may be swaying under the weight of the quick market depreciation.

Binance asserts that FTX misappropriated user data and will be “weeded out by the free market.”

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FTX Left on Its Own Following Binance’s Withdrawal

FTX’s founder, Sam Bankman-Fried, may be somewhat too responsible, as the cryptocurrency exchange’s problems began when it was revealed that FTX’s sister firm, Alameda Research, held a significant portion of its balance sheet assets in FTT. 

Binance told CoinDesk that it has conducted rigorous due diligence and considered new data indicating that FTX mishandled user payments.

Additionally, there are rumored US agency investigations that have dissuaded Binance from proceeding with the acquisition. Initially, it was envisioned that Binance would lend a hand to FTX and acquire the exchange to “protect consumers.” 

According to the spokesman, it is indeed Binance’s intention and objective to assist in enhancing FTX’s liquidity for the benefit of consumers.

Continues to Develop Decentralization

However, the subsequent statement lacked optimism. The FTX representative stated that enterprises who misuse customer funding will be “weeded out by the free market,” foreshadowing a bleak future.

The ecosystem will grow stronger as regulatory frameworks are built and the sector continues to advance toward greater decentralization, according to a CoinDesk representative. 

Customers have already begun withdrawing funds from the exchange and are unwilling to accept Bankman-promises Fried’s that the exchange has sufficient cash reserves to protect them.

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About Lou De Aguila

Lou Ramon Aguila is a contributor for Golden Casino News. He has a degree in BSBA Legal Management with great interest in high-profile legal cases involving sports personalities. An ultimate sports junkie, he covers just about everything in the sporting world with an emphasis on the NBA, NFL, and MLB. In his past time, Lou loves to read manga, watch anime and critique pro-wrestling matches.