FTT - 3 Lessons Every Investor Needs to Learn From the Collapse of FTX
The debacle that ensued last week can trace its roots to an investment Binance made in FTX back in 2019. At the time, FTX was a newcomer on the crypto scene, and Binance wanted to promote solidarity (and make a couple of bucks) in the crypto sphere, so they invested early on when FTX was just starting.
Eventually, FTX grew to the point that they felt Binance's stake in the company wasn't necessary. So in the summer of 2021, FTX bought out Binance's position in order to distance themselves from the competing exchange. The buyout was valued at $2.1 billion and came in the form of FTX's native token, FTT (CRYPTO: FTT) , and Binance's stablecoin, Binance USD (CRYPTO: BUSD) .
Fast forward to a year later. In early November 2022, CEO of Binance, Changpeng Zhao, took to Twitter to announce that they would be liquidating their entire FTT holding. This sent the first tremor through the crypto market. The tweet referenced "recent revelations" as the reason to sell their holdings, but what could those be? In typical crypto fashion, speculation ensued, and the market had a knee-jerk reaction to the news.
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3 Lessons Every Investor Needs to Learn From the Collapse of FTX