Binance has announced that it is backing out of its plans to acquire FTX, leaving Sam Bankman-Fried’s crypto empire on the verge of collapse.

The reversal comes one day after Binance CEO Changpeng Zhao announced that the world’s largest cryptocurrency firm had reached a nonbinding deal to buy FTX’s non-U.S. businesses for an undisclosed amount, rescuing the company from a liquidity crisis. 

Binance stated on Twitter, “As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX.”

“In the beginning, our 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 further stated.

On Monday night, facing a liquidity crunch, Bankman-Fried was scrambling to raise money from venture capitalists and other investors before he went to Binance, according to sources with knowledge of the matter. 

CZ had initially agreed to step in, but his company quickly changed course, citing reports of mishandled customer funds and alleged U.S. agency investigations.

It’s unclear who is next in line to buy the beleaguered crypto exchange. Bankman-Fried told investors that the company is facing a shortfall of up to $8 billion from withdrawal requests and needs emergency funding, according to a person familiar with the matter.

FTT had already lost 80% of its value between Monday and Tuesday, falling to $5 and wiping out more than $2 billion in a day. It dropped by more than half on Wednesday to around $2.30, shrinking the total value of circulating tokens to roughly $308 million.

Cryptocurrencies have plummeted amid the deal turmoil, with bitcoin falling 15% on Wednesday after a 13% drop on Tuesday. It’s now trading below $16,000 for the first time since November 2020. Ether, meanwhile, has plunged more than 30% over the past two days and is close to falling below $1,000.

Earlier this year, FTX was valued at $32 billion by private investors.