Binance’s founder, Changpeng ‘CZ’ Zhao, said on Sunday that the exchange is liquidating its investment in FTX’s FTT coin.
Changpeng Zhao said that the decision was based on recent developments. Alameda, FTX’s sibling firm, was reported to have assets of $14.6 billion.
The trading firm’s greatest asset is $3.66 billion in locked FTT, while FTT collateral worth $2.16 billion is its third largest asset. This indicates that more than $5 billion of the company’s assets are FTT, which raises questions about the company’s viability.
Changpeng Zhao noted that the FTT tokens that Binance wishes to dispose of are a portion of the $2.1 billion equivalent in FTT and BUSD tokens that the exchange obtained after selling its FTX equity stake last year.
Due to the present market circumstances and low liquidity, he estimates that it will be months before the exchange has sold all of the tokens.
FTT fell 7.6% in the past 24 hours as a result of the news and is presently trading at $22.62. The token is 73% lower than its all-time high of $84.18.