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Summary:
- State-backed venture capital fund Temasek entered talks with FTX, the crypto exchange led by Sam Bankman-Fried that is possibly insolvent following recent developments
- Temasek was an investor in SBF’s Bahamas-based exchange, per reports.
- News about the talks broke shortly after Changpeng Zhao tweeted that Binance will step in to help with the liquidity crunch and consider buying FTX in the process.
Crypto exchange FTX and Temasek have entered talks following a Binance bailout plan announced by Changpeng Zhao, the Strait Times reported on Wednesday.
Temasek operates a venture capital fund backed by the Singaporean government. The government-funded investment firm has deployed capital in several startups including FTX, the crypto exchange so far led by Sam Bankman-Fried.
The nature of the talks between Temasek and the crypto exchange remains unclear at press time. However, the timing of the talks supposedly sparked speculations on crypto Twitter. Some users have surmised that Temasek could offer SBF an alternative bailout plan amid FTT’s crash and uncertainty surrounding Alameda’s balance sheet.
CZ Might Buy FTX After Bank Run On SBF And FTT
The most recent contagion was triggered following a CoinDesk report that scrutinized Alameda’s books. Per the findings, the giant trading firm led by SBF had massive holdings of FTT, the native token “printed out of thin air” by FTX.
Shortly after, Binance CEO Changpeng Zhao said his crypto exchange planned to unwind its FTT positions worth $2.1 billion. Zhao also hinted that SBF had lobbied against Binance and other industry players.
Amid the debacle and FTT’s failing market price, SBF’s crypto exchange paused withdrawals. After hours of silence, both exchange chiefs tweeted about an agreement between both entities. CZ said Binance agreed to a non-binding letter of intent (LOI) to buy SBF’s exchange.
The so-called “strategic agreement” also mentioned that Binance will help solve the liquidity crunch. CZ stressed that Binance could pull out of the deal at any time pending the results of due diligence.
Prior to the announcement, SBF reportedly tried to hustle up $6 billion from Silicon Valley billionaires and wall street moguls.Temasek, a state-backed venture capital firm, has begun discussions with Sam Bankman-FTX, Fried's a cryptocurrency exchange that may be insolvent given recent events.
According to reports, Temasek invested in SBF's exchange in the Bahamas.
Shortly after Changpeng Zhao announced that Binance will step in to aid with the liquidity issue and explore buying FTX in the process, news of the conversations became public.
Following Changpeng Zhao's announcement of a bailout plan for Binance, the crypto exchange FTX and Temasek have started talking, according to a story in the Strait Times on Wednesday.
A venture capital fund run by Temasek is supported by the Singaporean government. The publicly supported investment company has invested in a number of firms, notably FTX, the cryptocurrency exchange currently run by Sam Bankman-Fried.
At the time of publication, it was unknown what was discussed between Temasek and the cryptocurrency exchange. The timing of the discussions, however, is said to have led to rumors on cryptocurrency Twitter. In light of FTT's failure and the uncertainties surrounding Alameda's financial situation, some users have speculated that Temasek would present SBF with an alternative bailout strategy.
After the bank run on SBF and FTT, CZ may purchase FTX.
The most recent outbreak started as a result of a CoinDesk investigation that examined Alameda's financial records. According to the results, the enormous trading company run by SBF had significant holdings in FTT, the native token that FTX had "created out of thin air."
Soon after, Binance CEO Changpeng Zhao announced that their cryptocurrency exchange intended to liquidate its $2.1 billion in FTT positions. Zhao also made a suggestion that SBF had campaigned against Binance and other market participants.
SBF's crypto exchange halted withdrawals in the midst of the disaster and the declining market price of FTT. Both exchange chiefs tweeted about an agreement between the two entities following several hours of silence. A non-binding letter of intent (LOI) to purchase SBF's exchange, according to CZ, was accepted by Binance.
Binance was cited in the so-called "strategic accord" as a potential solution to the liquidity crisis. CZ emphasized that Binance had the right to renege on the agreement at any point, pending the outcome of the due diligence.
SBF allegedly tried to extort $6 billion from Wall Street titans and billionaires in Silicon Valley before the revelation.