FTX insolvency rumours: Billionaire Sam Bankman-Fried says 'assets are fine'

Over the weekend, billionaire Sam Bankman-Fried's crypto exchange FTX became the subject of insolvency rumours after its competitor Binance announced plans to liquidate its entire holdings of FTX's native FTT tokens.

Changpeng Zhao, CEO of Binance, took to Twitter and said the decision to liquidate FTT tokens was “post-exit risk management, learning from Luna,” a reference to the collapse of the Terra-LUNA stablecoin ecosystem that wiped almost $60 billion off the market. However, he stressed that the move was not against his competitor.

Post the tweet, FTX experienced an increase in withdrawals on Sunday, as speculation mounted. Sam Bankman-Fried took to Twitter to address the issues. He tweeted, "Assets are fine. We don't invest client assets (even in treasuries). We have been processing all withdrawals and will continue to be."

Further, in a series of tweets, FTX clarified on the stablecoin redemptions, "Banks are closed for the weekend, though USD stablecoin creations/redemptions might be slower until wires clear tomorrow, especially for some coins/chains."

However, later, Binance CEO denied that his company’s announcement was part of conspiracy against FTX or that he’s in a “fight” with its CEO and clarified that he was back to building.

Since the speculation, as per CoinMarketCap data, FTT token is down nearly 25.82%, while Binance has seen an inflow of $411 million in stablecoins over the last week.