Justin Sun, the founder of the Tron cryptocurrency network and Grenada's ambassador to the World Trade Organization, tweeted late Wednesday that he and his team were "putting together a solution" with beleaguered cryptocurrency exchange FTX, hours after Binance announced it would not move forward in a deal to acquire the company.
Sun provided no details, only saying that his team "has been working around the clock to avoid further deterioration." Sam Bankman-Fried, the CEO of FTX, retweeted Sun's tweet.
Sun's tweet did not make clear whether this solution would rescue FTX as an entity or only backstop the Tron-related tokens held on the exchange.
FTX stunned the crypto industry on Tuesday when founder Bankman-Fried announced that it was facing liquidity issues only days after tweeting that the exchange was "fine." At the time, Bankman-Fried said he had come to an agreement to conduct a transaction with Changpeng "CZ" Zhao, the founder of Binance. CZ later clarified it was a nonbinding letter of intent to acquire FTX.
Binance backed away from the deal earlier on Wednesday, saying that after looking at FTX's books, "the issues are beyond our control or ability to help."
Questions arose about FTX sister company Alameda Research's solvency after CoinDesk published a report on its balance sheet, finding that a hefty chunk of Alameda Research's assets were composed of the FTT token, an exchange token issued by FTX. Bankman-Fried and other FTX and Alameda executives sought to downplay the concerns over the next week, before Bankman-Fried's surprise announcement.
As a result of the scuttled Binance agreement announcement, numerous regulatory agencies have hinted that they are investigating or broadening investigations into the company, including the U.S. Department of Justice, the Securities and Exchange Commission and the Commodity Futures Trading Commission. These agencies are looking at how FTX handled client funds, among other concerns, according to reports from Bloomberg and The Wall Street Journal.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish, a cryptocurrency exchange, which in turn is owned by Block.one, a firm with interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets including bitcoin and EOS. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.