Binance backs out of plans to acquire TSM sponsor FTX, casting further doubt on future of partnership

The future for FTX does not look bright.

Photo by Adela Sznajder via ESL

Following news that crypto marketplace and TSM name sponsor FTX would be acquired by rival Binance, new statements from Binance make FTX’s future seem even more bleak. Binance announced today that it won’t follow through with the acquisition of FTX following “corporate due diligence.”

Binance’s statement also cited news reports that FTX had previously mishandled customer funds as part of its decision. Binance said that its “hope was to be able to support FTX’s customers to provide liquidity, but the issues are beyond our control or ability to help.”

Binance pulling out of the proposed deal could put billions of FTX customer dollars in a risky situation and creates considerable doubt once again regarding the overall stability of crypto as a whole. 

The news is sure to send FTX’s stock plummeting even further than it already has. FTX founder and owner Sam Bankman-Fried was reported to have lost 94 percent of his net worth in one day, going from $16 billion to just about $1 billion. FTX’s issues will further add volatility to the crypto market at large as crypto holders seek liquidity with their funds.

How this affects TSM and the $210 million naming rights deal that the organization signed with FTX last year is yet to be seen. “FTX” remains affixed to TSM’s social accounts and the account names of many of the org’s players at time of writing.

But if news like this around FTX continues to unfold and a crash does occur in the crypto markets, it’s easy to see how the exchange’s 10-year naming rights deal with TSM would become complicated, to say the least.

TSM has not yet responded to a request for comment from Dot Esports.