Binance CEO Changpeng “CZ” Zhao: The planned FTX acquisition is not a “win for us”
The acquisition of rival FTX by Binance, according to CEO Changpeng “CZ” Zhao’s memo to staff on Wednesday, is not “a win for us.” Zhao posted the memo on Twitter after it was first covered by the Financial Times.
In the spirit of transparency, might as well share the actual note, sent to all Binance team globally a few hours ago.https://t.co/IUNkPcLC8T pic.twitter.com/XGlIJB7EV5
— CZ 🔶 Binance (@cz_binance) November 9, 2022
FTX’s near collapse has “severely shaken” confidence in the crypto industry and will see regulators “scrutinize exchanges even more,” Zhao wrote in the note. “Licenses around the globe will be harder to get,” he added.
After experiencing a liquidity crisis due to worries regarding the structure of sister company Alameda Research’s balance sheet, the Sam Bankman-Fried-led exchange FTX agreed to sell itself to the largest cryptocurrency exchange in the world on Tuesday. The native coin of FTX, FTT, was sold off by Binance as a first response to the story, hastening the widespread departure of assets from the FTX platform.
In his Wednesday note, Zhao reminded staff not to trade FTT tokens as due diligence for the deal continues. He acknowledged that Binance continued to own FTT tokens but that as soon as he talked to Bankman-Fried on Tuesday, he told his team to stop selling its holdings of FTT.
“We need to hold ourselves to a higher standard than even in banks,” Zhao wrote. Zhao also said in his staff note that Binance “did not master plan this or anything related to it.” “It was less than 24 hours ago that SBF called me. And before that, I had very little knowledge of the internal state of things at FTX. I could do some mental calculations with our revenues to guess theirs, but it would never be very accurate,” Zhao wrote.
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