Binance faces less competition after FTX’s demise, but with growing skepticism of centralized exchanges, that may not be enough to win new users.
Based on the joint statements on Twitter this week from Binance CEO Changpeng “CZ” Zhao and FTX CEO Sam “SBF” Bankman-Fried, it seems clear that FTX has serious solvency problems — so dire that few in the market are willing to save it. As a result, FTX is turning to CZ as a prospective buyer.
From a market share and platform standpoint, FTX does not offer any unique value to Binance . For all the business units that FTX offers, Binance has competitors of equal or even greater quality, including spot and derivatives trading platforms, staking products, and the ecosystem of startups building on its platforms. Binance will naturally win FTX’s clientele in the event that FTX fails, regardless of whether they make any deal.
As part of Binance’s exit from FTX equity last year, Binance received roughly $2.1 billion USD equivalent in cash . Due to recent revelations that have came to light, we have decided to liquidate any remaining FTT on our books. 1/4The reality is that FTX is already practically dead. Its FTT token is trading below $4, down roughly 80% since Nov. 7 — a period of just 24 hours. The company’s brand is beyond repair, and it will be exceedingly difficult to regain consumers’ trust.
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