CZ and SBF Twitter Fight Reveals How They Became Rivals

Recent Twitter storm revealed how the feud between rival exchange founders came to be.

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  • CZ called SBF a “fraudster” and “unhinged”
  • SBF said that CZ won and that there’s “no need to lie”

Friday’s Twitter fight between Changpeng (CZ) Zhao of Binance and Sam (SBF) Bankman-Fried revealed how the two became rivals. 

CZ branded the former Bankman-Fried as a “fraudster in a fiery Twitter thread.” He also revealed details about FTX’s buyout of Binance’s stake in the company. He said SBF was “unhinged” after Binance pulled out of its FTX investment. 

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The former FTX CEO claimed that CZ was lying about the deal. According to SBF, FTX initiated the buyout. He also said that Binance “threatened to walk at the last minute” without an additional $75 million. 

"You won. There's no need to lie, now, about the buyout," SBF said.

The firestorm started when CZ responded to a Thursday interview with former FTX spokesperson Kevin O’Leary. In the interview, O’Leary suggested that Binance had issues with regulators.

"It seems $15m not only changed Kevin O'Leary's mind about crypto, it also made him align with a fraudster. Is he seriously defending SBF?" CZ said.

O’Leary, whom FTX paid $15 million to be its paid spokesperson, said that FTX told him that one of the reasons why it was in trouble was its multibillion-dollar share buyback from Binance. Binance was an early investor in FTX and owned 20% of the exchange.

Himself an FTX investor, O’Leary said that the buyout cost FTX a “couple of billion” dollars. Moreover, he said he was forced to buy out Binance due to regulatory concerns, suggesting that regulators were uneasy with Binance.

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CZ responded with a link to more than 470 companies FTX invested in since the Binance buyout. The investments come up to a total of $5,3 billion.

How SBF and CZ Became Rivals – CZ’s Story

Binance’s CEO explained how the two CEOs of crypto exchanges went from partners to rivals. According to CZ, it all started when Binance decided to pull out of FTX. 

CZ said Binance decided to pull out of FTX after becoming “increasingly uncomfortable” with how SBF ran the exchange and sister firm Alameda Research. He claimed that the decision prompted Bankman-Fried to lash out at them.

"Sam was so unhinged when we decided to pull out as an investor that he launched a series of offensive tirades at multiple Binance team members, including threatening to go to 'extraordinary lengths to make us pay,'" CZ said. He added that he has text messages to prove it.

Following Binance’s exit, SBF began investing in friends in high places – from media and policymakers to celebrities (like Kevin), CZ said.

That’s also when SBF started attacking Binance and him personally, CZ said. “My ethnicity was a focus of those attacks,” CZ said. “I’m Canadian and Binance is not a Chinese company,” he added.

CZ also pointed out the extravagant amount of money FTX was spending on marketing.

"You don't have to be a genius to know something doesn't smell right at FTX," CZ said. "They were 1/10th our size, yet outspent us 100/1 on marketing & "partnerships," fancy parties in the Bahamas, trips across the globe, and mansions for all of their senior staff (and his parents)," he added.

On the Flipside

  • Both SBF and CZ are heavily vested in their own point of view, both personally and financially.

Why You Should Care

Understanding the key players in the space, and their motivations, is critical for traders. This exchange battle between CZ and SBF sheds light on the tensions between Binance and FTX, formerly two major rivals in the space. 

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
David Marsanic

David Marsanic is a journalist for DailyCoin who covers the intersection of crypto, traditional finance, and government. He focuses on institutionalized crypto entities like major cryptocurrency exchanges and Solana, breaking down complex topics into easy-to-understand writing. David's prior experience as a business journalist at various crypto and traditional news sites has enabled him to maintain a critical approach to news while adhering to high journalistic integrity standards.