withdrawals intensify on FTX after CZ announcement
Defi and Exchanges

Withdrawals intensify on FTX after CZ announcement

FTX ‘s stablecoin reserves plummeted as panic spread among its customers. SBF says it is able to process all withdrawals.

Last week, a report claiming that a significant portion of the balance sheet of Alameda Research, a company linked to FTX and also founded by Sam Bankman Fried, was made up of FTT tokens, caused some exchange users to question its financial health.

On Sunday, a tweet from the founder and CEO of rival crypto exchange Binance came to ignite the situation. Changpeng Zhao (CZ) announced that Binance planned to sell all of its FTT tokens acquired following its withdrawal from the company as a shareholder last year. “Due to recent revelations, we have decided to liquidate all of our FTT […].

FTX’s stablecoin reserves fell to $114 million on Monday from $394 million three days earlier, Bloomberg reports. In the past seven days, $451 million in stablecoins have exited the 2019-founded Bahamas-based exchange, according to TheBlock, citing a wave of customer withdrawals.

‘We’ve already processed billions of dollars in deposits/withdrawals today; we’ll continue,’ Sam Bankman Fried claimed overnight on Twitter.

A number of digital coin holders, still reeling from the many recent failures in the ecosystem, are thus rushing to withdraw their funds from the crypto exchange.

Meanwhile, others are betting against the FTT token, down 15% over 7 days and 2% over 24 hours. According to Coindesk, open interest in FTT futures has more than doubled to a one-year high. The combination of rising open interest and the negative financing rate suggests that traders are mostly selling.

A competitor is trying to bring us down with false rumors. FTX has enough [assets] to cover all client holdings. We do not invest client assets (even in Treasuries). We have processed all withdrawals and will continue to do so. I would love it, CZ, if we could work together for the ecosystem,” SBF shared this Monday afternoon.

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