FTX’s native FTT had a volatile weekend, with Binance starting to liquidate its coins due to recent discoveries indicating fears of a FTT crash, according to Binance CZ CEO. As of press time the FTT token is down 9.4% on the day.

However, the coin has fallen from its November 6 local low of 12.42 USD, down 15% since Saturday, November 5.

As part of Binance’s exit from FTX Equity last year, Binance received approximately $2.1 billion in USD cash (BUSD and FTT). Due to recent revelations that have come to light, we have decided to liquidate any remaining FTT on our books. 1/4

— CZ ? Binance (@cz_binance) November 6, 2022

FTT Coin Collapse Fears Binance Sells Over $600 Million

Rumors of CZ’s involvement began on Sunday, November 6, when FTX’s native token, FTT, fell sharply. There are fears that the FTT coin, affected by the economic downturn, could end up in a Terra Luna-style “death spiral”.

It looks like CZ is slowly dumping $500M worth of FTT on the market, if they continue Alameda’s FTT backed loans will lead to a death spiral.
Let the party begin! pic.twitter.com/lKJ1zwr17S

— Bitcoin Versus Gold (@VersusBtc) November 6, 2022

Most of the FTX cryptocurrency is subject to the $14 billion FTT token. Therefore, a 15% price drop would reduce FTX holdings by around $2.1 billion before the token starts to recover.

The FTT tokens held by Binance are assets received as part of its exit from the initial investment in FTX. While the news may seem unpleasant for FTT, CZ said it intends to liquidate the tokens in a way that minimizes market impact.

What has FTX revealed now?

FTX CEO Sam Bankman-Fried’s previous company, Alameda Research, has been rumored to be in bankruptcy. An article published on November 4 stated that “FTT token is another stupid flywheel” just like CEL’s CEL token.

Similarities between the two tokens are detailed in the report, with data on the network revealing that FTT ownership is highly concentrated, with 93% of all tokens held by just 10 addresses.

The volatility was noted by CryptoCred, which provided several consecutive analyzes of the weekend’s discoveries about the price movement of the FTT token, which feared the collapse of the FTT coin.

FTT nukes on Alameda bankruptcy rumors

FTT bounced back at Caroline’s clarifying tweet

FTT nukes are back on Binance selling their holdings

FTT bounced back at Caroline saying she would buy them all

It’s Sunday.

Welcome to Crypto.

– Credit (@CryptoCred) November 6, 2022

SBF retweeted a post by Carolyn Ellison, current CEO of Alameda Research, trying to control the rumors. Ellison emphasized that a group of companies not included in the latest leaked figures have assets of more than $10 billion.

A few notes on balance sheet information circulating recently:
– Specific balance sheet For a subset of our corporate entities, we have > $10b of assets not reflected there

— Caroline (@carolinecapital) November 6, 2022

Aside from the retweet, SBF is not publicly concerned about volatility or fears of an FTT collapse, as its other posts on November 6 focused on FTX features rather than FTT concerns.

Ellison responded directly to CZ on Twitter, saying that Almeida would be happy to buy FTT tokens from you today at $22 to minimize market impact, and Binance’s CEO confirmed that this is his goal.

@cz_binance If you want to reduce the marketing impact on your FTT sales, Almeida will happily buy from you today for $22!

— Caroline (@carolinecapital) November 6, 2022

On November 6, SBF did little to allay fears that FTT would collapse during CZ phishing and the crypto community’s focus on new FTX features. Talking about the “Send” feature that allows users to send encryption to email addresses and phone numbers, he showed an available dollar balance of just $6,311, leading users to joke that it was FTX’s reserve balance.

On November 8, Binance confirmed that a transaction of 30 million FTT tokens worth about $584.8 million from an unknown wallet to Binance was part of the FTT token liquidation.

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