Extreme volatility is rocking Bitcoin and the overall crypto markets after the leading digital asset exchange Binance announced its intentions to acquire the embattled exchange FTX.
Early on Tuesday, Binance CEO Changpeng Zhao and FTX CEO Sam Bankman-Fried came to an agreement that would allow Binance to fully acquire FTX.com.
FTX Token (FTT) is leading the market crash and is currently trading at $2.91, down over 86% in the last day and 93% down from its all time high.
At time of writing, FTT is a low-cap altcoin, with a market cap of $773 million.
FTT’s price crash coincides with concerns that FTX’s trading arm Alameda Research has heavily relied on the token as collateral for loans, which could be troublesome for the firm’s debt obligations.
According to Binance CEO Changpeng Zhao, the exchange is currently engaging in due diligence and other processes related to the takeover.
News of the takeover came after several days of back and forth between the two CEOs on Twitter amid rumors of insolvency and liquidity troubles at FTX.
After news of the agreement broke, crypto markets initially reversed upward, with Bitcoin (BTC), Ethereum (ETH) and most altcoins including FTT enjoying healthy bounces.
However, the markets turned on a dime and resumed their downtrend. According to crypto data aggregator Coinglass, markets have so far seen over $854 million in liquidations, the highest number recorded since August 19th.Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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