A Beef Between Sam Bankman-Fried And Changpeng Zhao? The Truth

On November 11th, FTX filed for chapter 11 bankruptcy after the firm could not raise over $8 billion. Although Binance had promised to buy out FTX from its financial woes, the company exited the deal last minute.

A report by CoinDesk kickstarted the latest FTX meltdown. CoinDesk revealed a leaked picture of Alameda Research’s balance sheet. The balance sheet showed that $5.8 billion out of the company’s supposed $14.6 billion assets were FTT tokens.

Additionally, the report revealed that the $5.8 billion represents over 180% of FTT tokens in circulation. Furthermore, CoinDesk alleged that Alameda sold stablecoins worth over $250 million between October 31st and November 2nd.

However, this revelation did not spark the catastrophic events that eventually bankrupted FTX. Instead, Zhao’s tweet on November 6th landed the deadly blow.

Zhao said Binance received about $2.1 billion in BUSD and FTT after its exit from FTX in 2021. Also, he announced that the exchange would liquidate all FTT tokens (worth about $530 million) on its platform.

This announcement had set the stone rolling. Reuters reported that users withdrew assets worth over $6 billion within 72 hours from FTX.

Zhao Offered To Bail Out Bankman-Fried

Surprisingly, Binance offered to help FTX by buying the company. Unfortunately, the exchange bailed out last minute, throwing FTX, Alameda, and its users into further crisis.

While Zhao announced the liquidation of FTT tokens, he stated that Binance’s action was not against any competitor. This contradicts Bankman-Fried’s tweet, which said a competitor was against the company.

Similarly, Binance’s Chief Strategy Officer, Patrick Hillmann, weighed in on the matter. He stated that a competitor had spread false information to US policymakers and the media about Binance.

Initially, it seemed Binance was looking past the beef and tried to acquire FTX. Both Zhao and Bankman-Fried even tweeted about the alleged acquisition.

Unfortunately, Binance dropped the deal after uncovering certain discrepancies in FTX’s balance sheet. Also, there were reports that the US SEC and CFTC were investigating the exchange.

Bankman-Fried Hints That Battle Is Not Over

Later, Bankman-Fried told his staff in a Slack channel that Zhao never planned to buy FTX. Binance’s denial of playing a significant role in FTX’s demise is not surprising.

Although the funds of several FTX users are in jeopardy, the users could turn out to be future users on Binance.

In addition, both Bankman-Fried and Zhao have opposing views on crypto regulation. While Bankman-Fried had been more direct with regulators, reports allege that Binance had been trying to evade regulators.

Bankman-Fried even vowed to support political campaigns, which must have given Zhao the impression that Bankman-Fried was getting on the good side of lawmakers.

Additionally, Zhao was not happy when FTX bailed out crypto firms during the crypto winter. In a Binance post, Zhao said the bailout was unnecessary and FTX should have let them fail.

However, the recent battle between Bankman-Fried and Zhao is not over. Bankman-Fried hinted at a possible “comeback” in his tweet yesterday. The tweet read:

“Sooner or later, I might have some things to say about a certain sparring partner. But as you know, no throwing stones at glass houses. Hence, I will say: well played, sparring partner; you won.”

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