Binance CEO’s Tweet Resulted in FTX Collapse: Caroline Ellison

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In the view of the former CEO of Alameda Research, Caroline Ellison, a tweet from Binance CEO Changpeng “CZ” Zhao played a role in the downfall of the cryptocurrency exchange FTX.

Binance CEO Blamed for FTX Implosion

Referring to CZ’s widely-known tweet on November 6, 2022, in which he declared Binance’s intention to liquidate its holdings of FTX Token (FTT) “due to recent revelations that have come to light,” she indicated this tweet as a contributing factor of FTX’s downfall during her testimony in Bankman-Fried’s criminal trial on October 12.

Ellison and Wang’s Testimony to Harm SBF’s Case

According to the report, Ellison asserts that while the tweet “contributed” to the collapse of FTX, the primary reason was Alameda’s borrowing of $10 billion from the exchange, which they couldn’t repay. 

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It’s worth noting that Ellison along with FTX co-founder Gary Wang had previously pleaded guilty in December last year, following allegations from the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC). 

These agencies had accused Ellison of manipulating the price of FTT at the direction of the exchange’s founder, Sam Bankman-Fried. She initially testified in Sam Bankman-Fried’s trial on October 10, revealing that Bankman-Fried had instructed her to have Alameda borrow billions of dollars from FTX without the consent of its users.

Binance CEO Responds Swiftly

In response to these allegations, CZ contested the notion that one of his tweets could have “destroyed FTX” in a thread on December 6. He stated, “No healthy business can be destroyed by a tweet.” CZ also highlighted Ellison’s own social media activity on November 6, asserting that Alameda’s offer to purchase Binance’s FTT holdings was the actual reason people started selling the tokens.

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SBF Wanted to Become President

Meanwhile in her previous testimony, she disclosed Bankman-Fried’s purported aspiration to become the President of the United States, his creation of various “alternative” financial spreadsheets for presentation to Genesis, and his exploration of Saudi Crown Prince Mohammed bin Salman as a possible supporter of the exchange.

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