14th November, 2022 Economy
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- Crypto exchange FTX admitted that "unauthorised transactions" have drained hundreds of millions of dollars from its wallets, saying the company has moved many digital assets to a new "cold wallet custodian".
What are FTX and Binance?
- FTX and Binance are cryptocurrency exchanges, meaning they enable customers to trade digital currencies for other digital currencies or traditional money, and vice versa. The two exchanges process the majority of all crypto trades in the world.
- FTX, one of the world’s largest exchanges, was run by Sam Bankman-Fried and is headquartered in the Bahamas. Binance, the largest exchange, is run by billionaire Changpeng Zhao.
- Both companies built their businesses on risky trading options that are not legal in the United States.
- A cryptocurrency exchange, or a digital currency exchange (DCE), is a business that allows customers to trade cryptocurrenciesor digital currencies for other assets, such as conventional fiat money or other digital currencies.
- Exchanges may accept credit card payments, wire transfers or other forms of payment in exchange for digital currencies or cryptocurrencies. A cryptocurrency exchange can be a market makerthat typically takes the bid–ask spreads as a transaction commission for is service or, as a matching platform, simply charges fees.