Crypto exchange Binance says it intends to buy rival FTX

ANKARA

Binance, the world's biggest cryptocurrency exchange by volume, intends to buy rival, FTX, co-founder and CEO Changpeng Zhao said Tuesday.

"This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI [letter of intent], intending to fully acquire http://FTX.com and help cover the liquidity crunch," Zhao wrote on Twitter.

He said Binance, in the coming days, will be conducting full due diligence -- a process that looks at the past and current performance of a company to decide whether the deal should go ahead.

FTX founder and CEO Sam Bankman-Fried confirmed that the firm has come to an agreement with Binance.

"Our teams are working on clearing out the withdrawal backlog as is. This will clear out liquidity crunches; all assets will be covered 1:1. This is one of the main reasons we’ve asked Binance to come in," he wrote on Twitter.

The amount of the deal has not been disclosed.

While FTX was valued at more than $30 billion earlier this year by private investors, it has been negatively affected by the dramatic downturn in the crypto market, which saw its total value plummet from $3 trillion to less than $1 trillion in less than 12 months.

FTT, FTX's token, saw its price dive more than 70% in the past week to less than $7 on Tuesday, while it saw a high of $65 during the last year.

Due to uncertainty and risks surrounding FTX, the value of the cryptocurrency market was down almost 10% to $930 billion at 2.15 p.m. EDT, according to data from the digital asset price-tracking website CoinMarketCap.