© Bloomberg

Peace in our time!

The cold war gripping cryptoland has suddenly turned very hot. Binance has stepped in to non-bindingly rescue rival cryptocurrency superpower FTX from a liquidity crunch it was widely considered to have helped create.

It’s a reverse ferret from SBF, who was talking on Monday about how “a competitor is trying to go after us with false rumors”. All friends now though. Apparently.

The trigger to surrender was FTX’s native token FTT slumping to new lows. TheBlock reported around 9am EST that FTX hadn’t done any on-chain withdrawals on Ethereum, Solana or Tron blockchains since 6:37am EST:

Crypto exchange FTX, which is currently fighting a battle with rival Binance, seems to have stopped processing clients’ requests for withdrawals, according to on-chain data.

The last outgoing transaction from FTX on the Ethereum blockchain took place at 6:37 a.m. ET, more than two hours ago, data from Etherscan show. It’s a similar story on the Tron and Solana blockchains as well, on-chain data show. 

Skirmishes had begun over the weekend, when Binance said it would dump its FTT tokens in response to “recent revelations”. This appeared to refer to claims about the fragility of Alameda Research, the FTX-linked trading firm, due to its reliance to FTT and other third-tier tokens.

Caroline Ellison, chief executive of Alameda, had suggested on Twitter that it could buy Binance’s FTT holdings at $22 per coin. Binance’s Changpeng “CZ” Zhao publicly rejected the proposal by making passing reference to Luna, the algo-stablecoin that collapsed spectacularly in June.

FTX's only option left was direct intervention to support its sort-of currency and discourage shouts of fire within its very crowded theatre. Support never arrived, however, and FTT slumped below $15.

Ouch © Coinmarketcap.com

The full story’s over on the FT mainsite.

SBF and FTX’s official Twitter accounts were uncharacteristically quiet through the drama. But CZ did find time to like this tweet.

Note: this post has been substantially revised post publication in an attempt to keep pace with breaking news

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