‘I Knew He Was Desperate:’ Binance CEO Opens Up About His Relationship With Sam Bankman

Binance CEO Changpeng “CZ” Zhao knew that Sam Bankman-Fried was in a desperate situation when he received a phone call from him begging him to save FTX.

CZ openly discussed the events that almost saw Binance come to the rescue of a competitor in difficulty. During the fourth edition of the Middle East and Africa Summit, Zhao disclosed more information on his relationship with colleague Bankman-Fried:

“I knew he was desperate when he approached me. And if we couldn’t help him, then no one else could. Probably many other people turned down the deal before he called me.”

Read also: It is also the fault of the users who trusted FTX, says the CEO of Binance

CZ really wanted to offer a lifeline to FTX, in the interest of affected users; but an analysis of the actual state of the company’s finances has revealed problems bigger than Binance could handle. The deal was later cancelled. A few days later FTX declared bankruptcynegatively affecting the cryptocurrency market and the entire financial ecosystem.

In the community, there has been much discussion of the not always friendly relationship between Zhao and Bankman-Fried: in fact, it seems that the CEO of FTX was lobbying in Washington against CZ and its exchange.

Zhao says SBF was initially a client of Binance through Alameda Research, and sought to partner with CZ to start its own cryptocurrency exchange. Zhao called Bankman-Fried “a young and technically capable person, surrounded by a good team. This led Binance to invest in the fledgling exchange FTX, founded in May 2019. An investment that has proved fruitful, at least initially:

“Their number of users grew. However, once they got big, I started hearing strange voices. Several people said to me ‘Hey, there’s this guy lobbying against you in Washington, he’s saying a lot of bad stuff behind your back.’

And that’s when we decided to revise our plans.”

The exchange Binance exited its FTX investment a year and a half agobut to do so he had to buy a certain number of FTX Tokens (ftt). But after rumors of problems in FTX and Alameda, Zhao announced that Binance would sold all of its FTTs:

“When he contacted me, I thought he would ask for an OTC deal to buy our FTTs to silence the rumors in the market. But he quickly told me he was in big trouble and was looking for a buyout.”

Read also: Sam Bankman-Fried ‘deserves what is happening to him,’ says Vitalik Buterin

CZ also discussed a recent tweet from SBF, in which he congratulated the victory of his “sparring partner. Zhao believes this tweet was aimed at him:

“At some point I may have more to add about a particular sparring partner, so to speak. But you know the saying goes: who is without sin…

So for now, I’ll just say this: well done, you win.”

Zhao stated that “only a psychopath could write such a tweet. Binance has never considered other exchanges as opponents, as the cryptocurrency market is still in its early stages:

“First of all, he never told me that he considered me his sparring partner. I’m actually not sure if that tweet was aimed at me or at Binance in its entirety. Let’s not consider other exchanges as opponents or competitors: it’s not a boxing match. “

Zhao disclosed that Bankman-Fried had been trying to raise funds for quite some time in any way possible, in hopes of saving the company:

“That day when he posted that tweet… I think he should have focused on something else, not social. I also remember sending him a message: ‘Hey Sam, here’s some advice. Stop doing what you’re doing, stop. Get dressed, go to Washington, and start answering questions truthfully.”

Zhao also discussed the known tweet who first drew attention to FTX and its liquidity issues:

“Liquidating our FTTs is one way to manage post-exit risk; we learned from LUNA. We have supported in the past, but we will not pretend to be in love after a divorce. We are not against anyone, but we will not support people lobbying other industry players behind their backs.

Some industry players have criticized Binance for this move, but CZ emphasizes that its actions have always been clear and transparent:

“Our team asked me if we should disclose our transactions, and I simply replied, ‘Why not?’ We want to be transparent. How can the market be manipulated if all actions are conducted transparently? We have not lied or deceived anyone.”

As FTX heads into bankruptcy proceedings, its new CEO, John Ray III, has too distanced himself from Bankman-Friedwho continues to give interviews and post strange messages on Twitter.

Read also: What is happening? Sam Bankman-Fried posts some strange messages on Twitter

‘I Knew He Was Desperate:’ Binance CEO Opens Up About His Relationship With Sam Bankman-Fried