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Binance\u2019s impending purchase<\/a> of struggling crypto exchange FTX has officially fallen through<\/a>. Now what? Without a support system to help FTX through its current liquidity crunch, it\u2019s unclear what will become of the second-largest crypto exchange, not to mention the funds of its more than one million users.<\/p>\n But perhaps this was predictable. After all, adjacent to the original authoritative announcements made via Twitter by both FTX CEO Sam Bankman-Fried<\/a> and Binance CEO Changpeng Zhao<\/a>, the nonbinding letter of intent (LOI) signed by Binance was relatively flimsy from the start. And this LOI ultimately acted as both the entry and exit point for Binance after the company found, as reported by the Wall Street Journal<\/a><\/em>, \u201ca big hole in FTX\u2019s finances\u201d.<\/p>\n There\u2019s much to be said about the developing FTX situation, but the gist of it is: Binance walking away from acquiring the exchange is going to cause significant <\/em>waves in the NFT space. Possibly even more serious than FTX\u2019s native token tanking<\/a>, and the excessive dissatisfaction of the FTX customer base<\/a>.<\/p>\n There\u2019s much at stake \u2014 and as the situation continues to unfold, the crypto and NFT communities are speaking up. Here\u2019s what they\u2019re saying.<\/p>\n For the most part, the mood throughout NFT Twitter seems somber, but hints of hope remain sprinkled here and there. While some fully expect FTX to become insolvent \u2014 with some sources even reporting<\/a> that Bankman-Fried himself says bankruptcy is imminent \u2014 others view the liquidity crunch as a learning moment. This is especially true in the case of Coinbase Co-Founder & CEO Brian Armstrong<\/a>, who took the moment to remind his followers about the promises of his own platform, emphasizing how working with policymakers could help mitigate situations like FTX\u2019s current one.<\/p>\n \u201cThe temptation from events like these is to call for more heavy-handed regulation. This would just make the problem of crypto companies and crypto users going overseas worse,\u201d Armstrong said via Twitter<\/a>. \u201cLong term, the crypto industry has an opportunity to build a better system with DeFi and self-custodial wallets that don\u2019t rely on trusting third parties,\u201d he added in a subsequent tweet<\/a>.<\/p>\n 7\/ Part of the issue here is that regulators have been focused onshore in each of their respective markets, while customers have moved offshore to companies with more opaque and risky business practices.<\/p>\n \u2014 Brian Armstrong (@brian_armstrong) November 8, 2022<\/a><\/p><\/blockquote>\n<\/div>\n 10\/ We should continue to work with policy makers to create sensible regulation for centralized exchanges\/custodians in each market (as we\u2019ve been doing for some time), but then we need to see a level playing field enforced, which hasn\u2019t happened to date.<\/p>\n \u2014 Brian Armstrong (@brian_armstrong) November 8, 2022<\/a><\/p><\/blockquote>\n<\/div>\n<\/div>\n While Armstrong looks to the future for answers, others worry about what the failed Binance and FTX deal could mean for the crypto and NFT industries. In the case of prominent NFT builder and collector Loopify<\/a>, the fear of the unknown has become a chance to spread positivity.<\/p>\n \u201cPeople have lost life savings and had their life turned around in a matter of days. But don\u2019t do anything you\u2019ll regret. It will be ok,\u201d Loopify said via Twitter<\/a>. \u201cI\u2019m not entirely sure how the market will act in the next few weeks or months. No one can ever predict things 100 percent,\u201d he added in the Twitter thread<\/a>. \u201cBut these situations yet again explain why being over-invested in coins or JPEGs is never the way to go.\u201d<\/p>\nWhat the NFT space thinks of the FTX debacle<\/h2>\n
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The importance of remaining calm in challenging times<\/h2>\n