Cryptocurrency exchanges Binance and Huobi announced that the native token for FTX this morning was the illicit issuance of nearly $400 million worth of tokens. of FTT blocked deposits.
FTX Tokens Released That Must Be Locked
FTT tokens follow an unlocking program in which large batches of tokens are periodically released. However, this morning, the tokens were released unscheduled without any warning or communication from FTX or the parties involved.
According to blockchain data, more than 192 million FTT tokens have been released. They were released at the main distributor.
Binance founder Changpeng Zhao said on Twitter:
“Binance has stopped FTT depositing to avoid questionable potential for additional supply affecting the market. We encourage other exchanges to do the same.”
FTT contract deployers moved all remaining FTT supply worth $400 million, which should be unlocked in batches. Not too sure what’s going on.https://t.co/JBPd02xIRk
— CZ 🔶 Binance (@cz_binance) November 13, 2022
CZ also added in his tweet:
“FTT contract distributors moved the entire remaining supply of FTT worth $400 million and these had to be opened in batches. I’m not quite sure what’s going on.”
Justin Sun-backed Huobi Global followed soon after. “We will be monitoring the situation closely,” Sun tweeted.
The release of FTTs comes after a week-long scandal with FTX, which revealed that its once very successful CEO, Sam Bankman-Fried, was embezzling client funds with his other company, Alameda Research.
FTX filed for Chapter 11 bankruptcy proceedings on Friday, and spillover risks are now permeating the more general crypto market.
*Not investment advice.
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