Cryptocurrency exchange FTX has lost at least one potential savior in its fight to fill a multi-billion dollar hole in its balance sheet.
The CTO of stablecoin issuer Tether, Paolo Ardoino confirmed on November 10 that the company has “no plans to invest or lend money to FTX/Alameda.”
Tether does not have any plans to invest or lend money to FTX/Alameda. Full stop.
— Paolo Ardoino (@paoloardoino) November 10, 2022
Tether does not have any plans to invest or lend money to FTX/Alameda. New paragraph.
Ardoino’s comments came after A Nov. 10 report from Reuters suggested that FTX is now in a $9.4 billion deficit, prompting FTX CEO Sam Bankman-Fried to go to multiple companies for cash to keep the exchange afloat.
According to the report, Tether, cryptocurrency exchange OKX and venture capital firm Sequoia Capital are some of the companies Bankman-Fried has approached for funding, reportedly asking for $1 billion or more from each.
The response from Tether’s CTO seems to be in line with the sentiment of a Nov. 9 blog post from Tether that assured the community that it has no exposure to Alameda or FTX.
It has also been reported that The stablecoin issuer has frozen 46,360,701 Tether (USDT) owned by FTX in its Tron blockchain wallet on Nov. 10 to comply with law enforcement.
It is not currently known if OKX or Sequoia Capital are considering supporting the embattled exchange.
Nevertheless, Lennix Lai, OKX’s head of financial markets, previously told Reuters on Nov. 9 that Bankman-Fried asked the exchange for up to $4 billion to help cover FTX’s liquidity problems, though he did not confirm whether the company would help FTX.
For his part, On November 10, Sequoia zeroed out its nearly $214 million investment in FTX, marking it a complete loss, saying FTX’s liquidity problems “created solvency risk” but added that it would not have a major impact on the company.
The crypto exchange Kraken has also been contacted by FTX according to two unnamed sources, as reported by Axios on November 10, but it was not said whether the two parties reached an agreement.
Cointelegraph reached out to OKX, Kraken, Sequoia Capital, and FTX for comment but did not immediately receive a response.
A Kraken spokesperson said it had “no comment to give at this time,” noting comments made by its co-founder Jesse Powell on Nov. 9.who when asked if he would buy FTX, said it would be “interesting” but added that he didn’t think “there would be value there anywhere near the hole that needs to be filled.”
So far, FTX appears to only be able to continue with limited withdrawals through an agreement with the Tron blockchain, which allows its assets to be exchanged 1:1 with external wallets. The deal saw Tron-based tokens trade at a premium of up to 1,200% on the platform.as users rushed to find a way out of the exchange.
Update Nov 14 1:00 AM UTC: Added a response from Kraken spokesperson.
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