After news broke that Binance would acquire FTX, cryptocurrency prices quickly recovered.
According to Binance, the company has signed a non-binding letter of intent (LOI). The parties will release more information on the acquisition in the next few days.
Still, there is a lot of conjecture about it, its potential significance for the crypto market, and the legal ramifications for FTX.
It appeared to be the conclusion of Binance CEO Changpeng “CZ” Zhao’s recent spat over FTX’s native coin, FTT.
The agreement would not affect either company’s US operations, pending due diligence. The move was initially attributed to allegedly cash-strapped FTX’s escalating liquidity concerns.
According to Zhao, the plan is for Binance to reach a “non-binding” agreement to acquire FTX.
The price action is whipsawing as voters in the United States travel to the polls for midterm elections, which has caused volatility in token prices as speculators speculate on what might happen on the regulatory front.
Crypto volatility increased by 14%. When combined with persistent concerns about rising inflation and uncertainty about the Federal Reserve’s next move, it has become a textbook catalyst for price volatility, according to market participants.