"It's good that CZ has its own position, if you don't want to say it, don't."
Changpeng Zhao (CZ), the Chief Executive Officer (CEO) of Binance reportedly turned down a $40 million offer from former FTX CEO Sam Bankman-Fried (SBF) in March 2019 who wanted him to establish a cryptocurrency futures exchange.
In context, futures crypto exchanges allow traders to leverage their funds through minimal collateral, but be aware that the market is highly volatile as prices can fluctuate rapidly.
Such volatility could result in futures crypto exchanges facing debt from insufficient collateral.
However, FTX which intends to overcome this has proposed to actively monitor the activities of traders, therefore the system will liquidate traders' positions when trading exceeds the collateral and this step can limit losses.
However, the two crypto exchanges had different objectives at the time as FTX wanted to serve institutional investors while Binance focused on retail customers.
Following that, CZ decided not to accept the offer but instead Binance chose to develop its own futures trading platform, then FTX also launched a similar service in 2019.
In 2022 during the FTX liquidity crisis, the already bankrupt crypto exchange approached Binance for a potential acquisition, but CZ turned it down as he believed the platform could not be saved.
