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Binance withdraws from FTX purchase, Bitcoin price falls

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Binance has scrapped its letter of intent to buy rival crypto exchange FTX, sending the price of Bitcoin into a freefall.

The cryptocurrency dropped as much as 14 per cent, within minutes of the Binance-FTX news being revealed.

A spokesperson for Binance said in a statement: “As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged U.S. agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com.”

FTX had been struggling with a surge in withdrawals that caused a “liquidity crunch”.

Concerns about FTX’s financial health reportedly triggered $6 billion worth of withdrawals in just three days.

This pressure came about due to Binance CEO Changpeng Zhao tweeting that Binance would sell its holdings of FTX’s digital token, known as FTT.

The token has lost over 70 per cent of its value since the start of the week.

FTX has also warned users not to withdraw monies at this stage, and are recommending people not make deposits.

Business

FTX Bankman-Fried now “living on credit cards”

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1 million creditors

Sam Bankman-Fried, the former boss of collapsed cryptocurrency exchange FTX, has denied committing fraud.

In a series of interviews to news agencies including the New York Times, ABC America and CNBC, the man once hailed as the ‘King of Crypto’ says he had a bad month and is almost broke.

FTX fell apart last month, having once been valued at $32bn.

Many investors have not been able to withdraw their funds from the now-bankrupt global exchange.

30-year-old Bankman-Fried has apologised to investors.

He denied having moved any personal money out of FTX himself – saying he now has “close to nothing.”

Speaking from The Bahamas, he said he had one credit card left.

In the interview, he said he had not deliberately misled investors.

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Business

Crypto’s Kraken slashes 30 percent of workforce

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One of the world’s largest crypto exchanges, Kraken, is laying off about 30% of its headcount, more than a thousand people.

The company’s co-founder and CEO Jesse Powell says the cuts are being made “in order to adapt to current market conditions.”

Powell wrote in a blog post that slowing growth, prompted by “macroeconomic and geopolitical factors,” had muted customer demand.

Powell says:

“We had to grow fast, more than tripling our workforce in order to provide those clients with the quality and service they expect of us,”

“I remain extremely bullish on crypto and Kraken.”

Crypto exchanges have been buffeted by withdrawals and regulatory scrutiny after the implosion of FTX, which is now spreading to other crypto exchanges.

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Crypto

Crypto companies on the verge of collapse

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The collapse of crypto empire FTX has sent shockwaves right around the world, with many questioning the future of digital coins

Now, one Australian company is feeling the pinch.

Brisbane-based ‘Digital Surge’ says it will halt all withdrawals, citing the “greatly upsetting” news FTX is in administration.

Digital Surge allows investors to trade cryptocurrencies in a number of different ways, including through self-managed super funds.

CEO Dan Rutter says his company “operates as a broker and is committed to facilitating the best trade for users at any time”.

This means a portion of assets are actually held by trading partners.

FTX was one of these trading partners and as a result, Rutter says the company isn’t currently able to operate “business as usual”.

Withdrawals have already been blocked for over a week. The CEO says the company is still solvent and this is all related to short-term liquidity challenges.

Adding, “until a permanent solution has been implemented, it is a legal requirement for Digital Surge to suspend all deposits and withdrawals”.

But the company remains tight-lipped about how many customers are affected and what exposure it had to FTX.

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