OKX Founder Comments On The FTX-Binance Situation
- The founder of popular crypto exchange, OKX, Star Xu, believes that no one will benefit from the struggle between leading exchanges Binance and FTX and the entire crypto industry will be at a loss.
- Xu believes that “if unfortunately FTX becomes another LUNA,nobody in the industry can benefit from the accident including Binance” and asked the two executives to work together.
- Binance CEO declined the offer from Alameda’s CEO Caroline Elison to purchase all of the FTT Binance intends to offload for $22 a piece on Sunday stating that he would like to remain on the free market.
The ongoing struggle between two of the biggest exchanges in the crypto space, FTX and Binance, has caught the attention of the entire crypto community, and some of the leaders in the space have come out to comment on the issue. One of them was the founder of another rival crypto exchange, OKX, Star Xu, who believes that no one will benefit from this struggle and the entire crypto industry will be at a loss.
The struggle between Binance and FTX began when crypto billionaire and founder of the world’s biggest crypto exchange, Changpeng Zhao also called CZ in the crypto space, stated that his firm would liquidate its entire holding of FTX Tokens (FTT) which it had received a year ago as a part of a deal. Binance had received $2.1 billion in BUSD and FTT and Zhao stated that his exchange sought to liquidate more than $500 million worth of FTT tokens.
According to OKX founder, this sale of FTT tokens will hurt Binance and not give it an edge over FTX, which is the second-biggest crypto exchange by market cap and rose to popularity after Binance incubated it two years ago. FTX, under the leadership of Sam Bankman-Fried, became a huge success. On the other hand, Zhao believes that Bankman-Fried started lobbying against his firm and also stated that Binance selling FTT tokens is a risk management strategy.
As noted by the OKX executive, Zhao compared FTT token with LUNA, which collapsed in may this year due to market volatility and an unstable algorithm. Xu believes that “if unfortunately FTX becomes another LUNA,nobody in the industry can benefit from the accident including Binance.” He further added that “both customers and regulators will lose some confidence about the whole industry .I hope CZ can think about stop to sell FTT and make a new deal with SBF.”
Additionally, Cobie, the host of uponlytv crypto podcast, also compared FTT to LUNA (now LUNC).
“If Binance simply selling their FTT causes a Luna-style crisis then it is already fucked, hiding it in back-door agreements will only prolong the problem. Imagine if Luna was 2x or even 10x bigger,”Cobie stated.
Interestingly, FTX’s sister firm, Alameda’s CEO Caroline Elison publicly offered to purchase all of the FTT Binance intends to offload for $22 a piece on Sunday but this was not acceptable to Zhao, who stated that he is not interested in making an OTC deal. “I think we will stay in the free market,” he said on Twitter on Monday, striking fear in the hearts of FTX users who immediately started to withdraw their coins from the exchange.
While CZ stated that it will take a few months for the sale to take place, the entire crypto industry feared that FTX has become insolvent. However, this was not the case as pointed out by SBF as he put down the insolvency rumors.