Sam Bankman-Fried's empire is on the verge of collapse after the company backed out of its plan to acquire FTX.
The reversal comes a day after Changpeng Zhao announced that the world's largest coin firm had reached a non-binding deal to buy FTX's non-U.S. businesses. Private investors valued FTX at $32 billion.
Sources with knowledge of the matter say Bankman-Fried was scrambling to raise money from venture capitalists and other investors before he left on Tuesday. It's not clear who is next in line to purchase the exchange.
The collapse of the world's fourth largest exchange is the latest chapter in a shocking collapse. Bankman- Fried tried to assure investors that the company's assets were in good shape. The selloff of FTX's native token was on after the company's CEO said that his company was selling its holdings.
Customers demanded $6 billion in withdrawals, according to Bankman- Fried.
The price of ether plunged more than 30% over the past two days, and on Wednesday it fell another 13%.
The full statement can be found here.
Due to the recent news reports regarding mishandled customer funds and alleged US agency investigations, we have decided not to pursue the acquisition of FTX.com.
Our goal was to be able to support FTX's customers, but the issues are beyond our control.
Retail consumers will suffer when a big player fails. The free market will weed out outliers that misuse user funds in the future, as we have seen over the last few years.
The industry will grow stronger as regulatory frameworks are developed.
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