Crypto Exchange FTX Investigates Buying Bithumb
According to a report from TheBlock, the popular crypto exchange FTX is exploring the potential purchase of Bithumb. The South Korean platform will absorb the list of the Sam Bankman Fried company’s recent acquisitions.
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According to the report, FTX has been in talks to buy Bithumb for several months. The South Korean platforms have attracted controversy due to their security flaws, which have led to millions in losses for customers, and most recently for being under the loop of local authorities.
The report claims Bithumb is part of the South Korean investigation regarding the collapse of the Terra ecosystem. Authorities are investigating the company behind the development of Terra, Terraform Labs (TFL), and its founders. The company previously had its head office in the Asian country.
If the purchase goes through, FTX will have acquired a platform that processes over $600 million in daily trading volume. During the recent bearish price action in the crypto market, the Bankman Fried company has been reported to be in talks to acquire US trading platform Robinhood and Canadian exchange Bitvo.
In addition, FTX has become the lender of last resort for several crypto companies affected by the Terra (LUNA) disaster. The exchange has provided credit lines and entered into a partnership with the crypto lending companies BlockFi and Voyager.
On BlockFi, FTX will provide them with a $400 million credit facility. This will help the crypto lending firm to continue its operations while the Bankman Fried company will have a call option of up to $240 million.
Voyager will also receive a line of credit as the lending company filed for bankruptcy and stopped withdrawals. Today, FTX’s CEO suggested Voyager users “early liquidity” so they could withdraw a percentage of their money.
Crypto Exchange FTX Presents Plans for Voyager Users
Voyager faced backlash from users when it presented its “restructuring process”. The platform claimed that customers with USD deposits will receive all their funds, while crypto users will receive a “mix of assets” with a portion largely dependent on a lawsuit with failed crypto hedge fund Three Arrows Capital (3AC).
This company reportedly owns Voyager over $600 million and has begun a process to hold 3AC “accountable” and recover the funds to repay its customers. Users complained, claiming that they want to be made whole with crypto-assets that were originally in their accounts.
FTX proposed a solution by offering Voyager customers access to a portion of their money by opening an account with FTX funded by “an early distribution of a portion of their bankruptcy claims”. Voyager users will be able to access their funds on the exchange platform.
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As FTX specified, this proposal is voluntary. Therefore, users do not need to participate. The exchange expects to perform these operations if a Voyager user decides to sign up, by early August. Bankman Fried said:
Voyager’s clients did not choose to be bankruptcy investors with unsecured claims. The goal of our joint proposal is to help establish a better way to resolve an insolvent crypto business – a way that allows clients to get early liquidity and reclaim part of their assets without forcing them to speculate on bankruptcy outcomes and take unilateral risks .
