FTT fell more than 80% in 24 hours as fears mounted over Alameda Research's balance sheet. Binance's FTX bailout may not extend to Alameda. Alameda holds a large amount of FTT tokens. The firm may face margin calls and be forced to sell its assets to raise liquidity. Alameda is a major market maker and lender and its collapse could spell trouble for the broader crypto industry.
Binance has agreed to buy FTX. Financial terms of the transaction have not been revealed. The deal does not include FTX.US. It was recently revealed that FTX's corporate sibling Alameda Research was too reliant on illiquid tokens. This caused investors to start withdrawing funds from FTX. Binance added to the pressure by announcing it would sell its FTT holdings.
Bebop has launched on Polygon. The decentralized exchange allows users to trade a basket of tokens in a single transaction. Bebop chose to launch on Polygon due to its low fees, high speed, and sustainable Proof-of-Stake model. Polygon recently announced partnerships with Meta and JPMorgan.
Binance will soon introduce Merkle-tree proof of reserves in the interest of full transparency. A Merkle tree is a data structure used by blockchains to store transaction data. A proof of reserve system would use public blockchain data to prove that exchange users' crypto holdings are safe.
Helios is a fully trustless and portable Ethereum light client. It is lightweight enough to be run on mobile devices. Helios syncs in seconds and requires no storage.
FTX could have sought emergency debt financing, new money investment, liquidated its assets, or otherwise bought more time, but instead it chose to let Binance buy it out. It is likely that FTX was lending out customer funds to Alameda. The exchange was unable to meet the large number of withdrawals, and its debt probably was so large that it couldn't be covered by other financiers. FTX under Binance's management will likely be looking to recover its loans to Alameda.
Innovation in digital payments is slow because regulators have yet to set clear standards on what is and isn't allowed. The lack of regulatory clarity also slows down mainstream adoption. Legislators are unsure how to regulate digital assets because they don't know how they are used, both legally and illegally. Companies are choosing to test technologies in countries with clearer rules to avoid regulatory issues.
Coinbase experienced an outage for around two hours on Tuesday. The outage occurred as FTX's FTT token started crashing. Coinbase has struggled to cope with surges in trading volume in the past. The exchange is now monitoring a fix for the issue that caused the outage.