Troubled FTX reaches deal with Tron to swap some assets

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Key Takeaways

  • Tron blockchain to allow holders of TRX, BTT, JST, SUN, and HT—to withdraw their tokens from FTX 1:1 to external wallets
  • Following the announcement, TRX surged over 140% on FTX
  • At present, $13 million of crypto assets will be deployed to facilitate the swaps.

Cryptocurrency exchange FTX, which is on the brink of getting liquidated, has now signed a deal with the Tron blockchain to allow holders of TRX, JST, BTT, SUN, and HT—to withdraw their tokens from FTX at 18:30 UTC. This means that FTX users if they plan to withdraw their funds, must accept to buy Tron coins from FTX at a significantly higher price than the rates at which they will be able to sell them on other crypto exchanges.

As per the official announcement, $13 million of assets will currently be deployed to facilitate the swaps. “We are pleased to announce that we have reached an agreement with Tron to establish a special facility to allow holders of tron (TRX), bittorrent (BTT), just (JST), sun (SUN), and Huobi token (HT) to swap assets from FTX 1:1 to external wallets,”.FTX Tweeted.

“In other words, no matter how things evolve, Tron DAO and Huobi will do their best to support the exchange of the TRON tokens (TRX, BTT, JST, SUN, HT) deposited on the FTX platform at a 1:1 ratio, including during the worst case scenario that we all know may happen”, Tron founder Justin Sun hinted before making the official announcement in the late hours on November 10.

Following the official announcement, TRX, the official token of Tron, surged over 140% on FTX, from 12 cents to 29 cents. 

FTX Founder Sam Bankman Fried also took responsibility for his actions and further tweeted that he hopes Tron’s help is just step one of finding ways to bring liquidity to users. “That is the core thing that I am fighting for right now and will continue to fight for in whatever ways I can,” his tweet reads.

Tron’s help comes after FTX’s supposed acquisition deal by Binance fell through after scrutiny of FTX’s books.

However, many crypto enthusiasts are highly skeptical about the exchanges’ 1:1 FTX Redemption of Tron-Based Tokens. Since Tron will only deploy $13 million worth of funds into FTX, signaling that there exist no guarantees that FTX users will be able to withdraw their funds even if they buy the coins at unreasonable rates. 

Many believe FTX is trying to partially fill the $9.4 billion hole in its balance sheet with the help of Tron by forcing its users to surrender nearly 80% of their portfolio to the arbitrageurs FTX has set up while providing zero guarantees that they will be able to withdraw their funds.

FTX’s liquidity crisis began over the weekend, with Binance CEO Changpeng Zhao stating on November 6 the exchange would liquidate its FTX Token triggering the FTT token to fall to new lows.

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Saniya Raahath
Saniya Raahath

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