The news: The world’s largest cryptocurrency exchange Binance will walk away from its nonbinding rescue deal to buy competitor FTX after a surge in withdrawals led the latter to a liquidity crisis.
Timeline of FTX on the ropes:
Crypto industry in crisis: The near-collapse and will-they-or-won't-they possible bailout of one of the biggest names in crypto has rocked the industry: Prices have fallen abruptly with Bitcoin down by more than 10% to its lowest level since November 2020.
The rescinding of the deal will do little to thaw the crypto winter and adds to fears of price volatility and the need for future bailouts.
What it means for crypto:
The bottom line: Just 16% of adults have some level of trust in crypto. And Binance's dismissal of FTX will do little to improve consumer confidence. To strengthen faith in the crypto industry, clear regulation is needed across countries and markets. But that could still be some way off.
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