Sam Bankman-Fried of FTX Announces Plans to Launch Stablecoin

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Ruholamin Haqshanas

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Ruholamin Haqshanas

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Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

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October 23, 2023 08:32 EDT

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FTX CEO Sam Bankman-Fried has confirmed that the crypto platform is working on launching its own stablecoin. 

In an interview with The Big Whale, Bankman-Fried said “it is very likely” FTX will launch a stablecoin, joining most other major exchanges in having launched a crypto token whose value is tied to fiat currencies. He added that they know how to create a stablecoin and are looking for the best partner to work with.

“Yes, it is very likely. We know how to create a stablecoin. We’re just thinking about the best partner to do it with. What I can tell you is that you’ll be hearing from us soon,” the billionaire said. “I think you’ll probably be hearing something from us on that in the not-too-distant future.”

A stablecoin is a cryptocurrency that strives to keep its price pegged to fiat currencies like the US dollar or the pound. The biggest stablecoins in terms of market capitalization are Tether’s USDT, Circle’s USDC, and Binance’s BUSD, all of which are pegged to the US dollar.  

The FTX chief noted that the crypto platform already has the know-how to launch its stablecoin, but they prefer to do it in partnership with another company in order to make it more powerful. 

“We’ve held off on doing it because, I think to some extent, we think that cooperating on that can be really powerful and a lot of that ends with us trying to find the partners we’d be really excited to work with there,” said Bankman-Fried.

“Second Great Stablecoin War” is Here

Bankman-Fried’s stablecoin announcement comes just days after the CEO predicted the start of “the Second Great Stablecoin War” on Twitter. In an October 23 tweet, he said, “Thus begins the Second Great Stablecoin War. (The first one, fought in ~2018, ended with USDC and USDT edging out TUSD/GUSD/USDP.)”

1) Binance converts USDC –> BUSD, and we see the change in supplies.

Thus begins the Second Great Stablecoin War. (The first one, fought in ~2018, ended with USDC and USDT edging out TUSD/GUSD/USDP.) https://t.co/X2VLOBOTev

— SBF (@SBF_FTX) October 23, 2022

The tweet was in response to Binance’s move to auto-convert other USDC into its own stablecoin, BUSD. The move has resulted in a surge in BUSD supply, which has recently topped $20 billion for the first time ever. Furthermore, BUSD supply as a share of the overall stablecoin market is at an all-time high of 15.48%.

Meanwhile, Bankman-Fried also revealed that they are considering another round of fundraising for FTX in a bid to fuel its acquisition spree. He claimed that the exchange’s cash position of between $1 billion and $4 billion puts it “in a great position to do small and medium-sized acquisitions.”