Tether Won’t be Aiding FTX
- Tether reportedly froze 46,360,701 Tether USDT owned by FTX in its Tron blockchain wallet to cooperate with the law authorities.
- FTX CEO Sam Bankman-Fried has approached several crypto exchanges for help, but all attempts have yet to prove successful.
- SBF built a reputation for aiding embattled crypto firms, and his decline has been a much-discussed topic over the past few days.
Embattled cryptocurrency exchange FTX has continued to approach other crypto firms and investors for help. However, there seem to be no plans for a bailout from Tether. Paolo Ardoino, the stablecoin issuer’s chief technology officer, dismissed any rumours of a potential cash injection into FTX or its counterpart, Alameda Research. He wrote in a tweet,
Tether does not have any plans to invest or lend money to FTX/Alameda. Full stop.
Ardoino made his remarks after Reuters recently reported that FTX had a $9.4 billion shortage. The company’s CEO, Sam Bankman-Fried, had been reaching out to many businesses for funding to keep the exchange operating. SBF is said to have approached the likes of Sequoia Capital, Tether and OKX for financial aid. But help appears to be difficult to come by.
It is still unclear whether OKX or Sequoia Capital are considering assisting the struggling exchange. Bankman-Fried reportedly asked the exchange for up to $4 billion to help with FTX’s liquidity problems. Lennix Lai, director of financial markets at OKX, confirmed to Reuters on November 9 that the company had not yet made up its mind regarding a bailout of FTX.
Sequoia, on November 10, decided to cancel its investments in FTX. It deemed them a total loss, adding that FTX’s liquidity crisis posed a solvency risk, but the impact would be minor. Sources revealed that FTX contacted Kraken, but it is still unclear whether both firms reached an agreement.
Binance was the first to excuse itself from the FTX saga after initially confirming plans to purchase the firm. According to Changpeng Zhao, Binance’s CEO, the situation at FTX was worse than initially feared. Since the unsuccessful Binance deal, FTX’s future appears to be in doubt.