Binance, the world’s largest crypto exchange, has signed a letter of intent to acquire its rival FTX, Binance’s co-founder and chief executive Changpeng Zhao tweeted Tuesday. FTX chief executive Sam Bankman-Fried tweeted that FTX had entered into a “strategic transaction” with Binance, pending due diligence.
“There is a significant liquidity crunch” at FTX, while Binance intends to help cover it, according to Zhao. The proposed acquisition happens after tension rose between the two exchanges, as Zhao tweeted Sunday that the exchange would start liquidating its remaining FTT tokens, the native token of FTX, held on its books. Binance held about 23 million FTT tokens, worth over $500 million based on its current price, according to a Bloomberg article citing people familiar with the matter.