Bitcoin fell to a two-year low this week due to concerns about the platform’s financial problems, and by Friday night, it was trading at $16,861 (€16,256). The crisis-hit cryptocurrency exchange FTX applied for US bankruptcy protection on Friday after suffering the equivalent of a bank run in digital money.
Customers left FTX earlier this week because of concern about a lack of capital, leading to an agreement to sell the company to larger rival Binance.
The cryptocurrency community had hoped that Binance, the biggest cryptocurrency exchange in the world, could be able to save FTX and its depositors.
After reviewing FTX’s financial records, Binance came to the conclusion that the issues facing the smaller exchange were insurmountable, and it withdrew from the agreement.
A business that was once the darling of the cryptocurrency market had a dramatic fall in popularity. In January, FTX collected $400 million from investors, valuing the business at $32 billion. It received funding from investors including the Ontario Teachers’ Pension Plan and Temasek, a state-owned investment company in Singapore, as well as from celebrities and athletes.