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Why Binance Walked Away from Acquiring FTX? Here’s What Went Wrong
On October 27, Sam Bankman-Fried, the CEO of crypto exchange FTX, had quite a day in court . His exchange FTX could have been a part of crypto giant Binance. But the deal broke down. But what went wrong? Let us dive into the details
When SBF co-founded FTX with Gary Wang in Hong Kong back in 2019, he had a vivid vision to make it a hotbed for crypto margin trading—a space that, in his view, was largely unattended to by other players. His strategy was as ambitious as risky; margin trading is not for the faint-hearted. SBF said their ace in the hole was an advanced risk engine, far more sophisticated than what most exchanges offered at the time. It considered a broad spectrum of variables in a trader’s account before triggering liquidation.
One unique feature that separated FTX from the herd was its early adoption of cross-margin trading. This allowed traders to use excess margin from one position to satisfy margin requirements in another, a kind of financial juggling act that required a highly advanced risk management system.
Read More: https://coinpedia.org/news/why-binance-walked-away-from-acquiring-ftx-heres-what-went-wrong/
On October 27, Sam Bankman-Fried, the CEO of crypto exchange FTX, had quite a day in court . His exchange FTX could have been a part of crypto giant Binance. But the deal broke down. But what went wrong? Let us dive into the details
When SBF co-founded FTX with Gary Wang in Hong Kong back in 2019, he had a vivid vision to make it a hotbed for crypto margin trading—a space that, in his view, was largely unattended to by other players. His strategy was as ambitious as risky; margin trading is not for the faint-hearted. SBF said their ace in the hole was an advanced risk engine, far more sophisticated than what most exchanges offered at the time. It considered a broad spectrum of variables in a trader’s account before triggering liquidation.
One unique feature that separated FTX from the herd was its early adoption of cross-margin trading. This allowed traders to use excess margin from one position to satisfy margin requirements in another, a kind of financial juggling act that required a highly advanced risk management system.
Read More: https://coinpedia.org/news/why-binance-walked-away-from-acquiring-ftx-heres-what-went-wrong/
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