Binance to sell remaining FTT tokens, CEO announces

Binance CEO Changpeng "CZ" Zhao announced Sunday that he would sell the remaining FTT tokens he acquired when quitting FTX last year.

CZ explained that the sales might require several months to complete because he wanted to minimize the “market impact” it would cause. When Binance left FTX equity in 2021, it received $2.1 billion in Binance's stablecoin (BUSD) and FTT.

Etherscan reported that 23 million FTT units had been moved to a Binance exchange wallet last Saturday, showing that the plan to sell the assets was already in motion. The volume is equal to 17 percent of the total FTT in circulation today, with the transaction worth approximately $530 million.

On Sunday, FTT’s price dropped by 14 percent to $22.02 per unit, its lowest point since June this year. It eventually rebounded to $23.03 later in the day.

Analysts predicted that CZ’s decision to sell his FTT assets was related to the financial situation of FTX’s sister company, Alameda Research. The company’s leaked balance sheet revealed that Alameda Research had reserved $5.8 billion in FTT tokens on June 30. Data also showed that Alameda held $14.6 billion in assets against $8 billion in liabilities, which also encompassed $7.4 billion in loans.

CZ, however, denied that he attempted to pressure FTX and Alameda Research by selling his FTT assets. He said he wanted to take a “precaution,” especially after the case of Terra and Luna earlier this year.

The sister tokens had their assets tied closely to each other, so when Terra faced a downfall, Luna immediately followed suit. This major event led to bankruptcies within the crypto industry, including the giant lender Celsius.

The CEO also explained the practice in his company regarding asset holdings, saying that “we typically hold tokens for the long term.”

“And we have held on to this token for this long. We stay transparent with our actions,” CZ wrote on Twitter.

Binance did not reveal its initial investment in FTX when it gave up its stake. Last year, CZ said it exited from the exchange platform due to a “normal investment cycle,” adding that FTX’s growth had delighted him.

Alameda’s clarification

Caroline Ellison, CEO of Alameda Research, addressed the supposedly leaked balance sheet, which had circulated in social media.

According to Ellison, the reported sheet did not show $10 billion of Alameda Research’s assets, adding that the company had undisclosed hedges. It also returned a significant amount of its outstanding loans.

Ellison also responded to CZ’s pledge to let go of his FTT assets. She offered to purchase the token at a fixed rate of $22 per unit if CZ dumped the assets onto the market at an interval to prevent a sell-off.

Alameda Research founder and FTX CEO Sam Bankman-Fried was asked about his opinion of Ellison's offer to CZ. He said the solution was “quicker and easier,” especially since CZ wanted to reduce the impact on the crypto market.

Bankman-Fried expressed his respect for CZ and his contributions to the crypto industry. He stressed that stakeholders within the industry should collaborate to build a good blockchain.