FTX Token Crashes 85% In Minutes — FTT Becoming The Next LUNA

Star Xu, the founder of cryptocurrency exchange OKX, has spoken up about the rift between Binance and FTX’s founders, resulting in a sell-off of FTX’s native token, FTT.

Xu said in a tweet that if FTX becomes another LUNA, the collapsed native token of the Do Kwon-founded Terra blockchain, which wiped out an estimated $60 billion, nobody in the industry would benefit. This is because customers’ and regulators’ confidence in the crypto industry would be affected.

“If unfortunately, FTX becomes another LUNA, nobody in the industry can benefit from the accident, including Binance. Both customers and regulators will lose some confidence about the whole industry.” Xu wrote.

His remark is coming on the back of CZ stating on Nov. 6 that Binance would be liquidating any remaining FTT tokens it has on its books “due to recent revelations that have come to light.” He added that the liquidation will be spread over several months and should not be construed as Binance taking aim at a competitor but as a post-exit risk management strategy. 

However, SBF alleged that “a competitor” is trying to go after FTX with “false rumors.” He explained that FTX is heavily regulated and has enough funds to cover all client holdings, adding that he is willing to work with CZ for the good of the ecosystem.

In a new update, Binance and FTX finally reached a truce as Binance struck a “non-binding” deal to acquire FTX, Zhao said on Twitter.

FTT is taking a hit from the debacle

Since the debate between CZ and SBF began, the price of FTT has been dropping sharply. FTT is trading at about $4, down 80.29% in the last 24 hours, per data from CoinMarketCap. 

According to on-chain data pointed out by crypto market journalist and observer Collin Wu, Binance may not be the only party looking to liquidate their FTT holdings. Wu noted that 1.9 million FTT (worth about $44 million) was transferred from the Genesis over-the-counter (OTC) desk to FTX, but CZ has said it was not Binance selling.

Meanwhile, the sell-off has also affected SOL, the native token of the Solana blockchain, which has a strong relationship with FTX. As highlighted by Wu, SOL has also plunged 25% in the last 24 hours. SOL is currently trading at $24.06.