FTX Seeks Salvation from Liquidity Crunch, Approaches Kraken: Report
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Nov. 10, 2022

Cryptocurrency exchange FTX, which suspended user withdrawals due to an alleged $8 billion hole in its balance sheet, has reached out to US-based trading platform Kraken for help, Axios has learned, citing two sources with knowledge of the matter.

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There are no details on the conversation between FTX and Kraken so far, but Axios pointed out that FTX's move to seek help from smaller rivals shows how desperate the exchange in its attempts to cover financial obligations.

In an interview with Bloomberg on Wednesday, Kraken Founder, Jesse Powell, hinted that FTX "has some assets that are interesting and have some value."

Coinbase's Armstrong Says Exchange Has 'No Material Exposure' to FTX

However, he acknowledged that FTX is likely to go bankrupt given that its hole in balance sheet from the outside "looks like mostly a pretty big crater." As of press time, nor Kraken or FTX made any public comments regarding the matter.

  • According to The Wall Street Journal's sources, FTX boss Sam Bankman-Fried is seeking emergency funding to cover a shortfall of up to $8 billion due to a massive wave of withdrawals requests in recent days.
  • Meanwhile, Reuters reports that at least $4 billion in FTX funds — including clients' assets — have been transferred by Bankman-Fried to keep Alameda Research afloat.
  • FTX is trying to find any interested investors it can after Binance refused to proceed with its acquisition plans, citing mishandled customer funds and alleged US agency investigations related to FTX.

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