State-backed venture capital fund Temasek entered talks with FTX, the crypto exchange led by Sam Bankman-Fried that is possibly insolvent following recent developments
Temasek was an investor in SBF’s Bahamas-based exchange, per reports.
News about the talks broke shortly after Changpeng Zhao tweeted that Binance will step in to help with the liquidity crunch and consider buying FTX in the process.
Crypto exchange FTX and Temasek have entered talks following a Binance bailout plan announced by Changpeng Zhao, the Strait Times reported on Wednesday.
Temasek operates a venture capital fund backed by the Singaporean government. The government-funded investment firm has deployed capital in several startups including FTX, the crypto exchange so far led by Sam Bankman-Fried.
Beyond being an FTX investor, the nature of the talks between Temasek and the crypto exchange remains unclear at press time. However, the timing of the talks supposedly sparked speculations on crypto Twitter. Some users have surmised that Temasek could offer SBF an alternative bailout plan amid FTT’s crash and uncertainty surrounding Alameda’s balance sheet.
CZ Might Buy FTX After Bank Run On SBF And FTT
The most recent contagion was triggered following a CoinDesk report that scrutinized Alameda’s books. Per the findings, the giant trading firm led by SBF had massive holdings of FTT, the native token “printed out of thin air” by FTX.
Shortly after, Binance CEO Changpeng Zhao said his crypto exchange planned to unwind its FTT positions worth $2.1 billion. Zhao also hinted that SBF had lobbied against Binance and other industry players.
Amid the debacle and FTT’s failing market price, SBF’s crypto exchange paused withdrawals. After hours of silence, both exchange chiefs tweeted about an agreement between both entities. CZ said Binance agreed to a non-binding letter of intent (LOI) to buy SBF’s exchange.
The so-called “strategic agreement” also mentioned that Binance will help solve the liquidity crunch. CZ stressed that Binance could pull out of the deal at any time pending the results of due diligence.
Prior to the announcement, SBF reportedly tried to hustle up $6 billion from Silicon Valley billionaires and wall street moguls.