FTX's billionaire chief Sam Bankman-Fried and his counterpart at Binance, Changpeng Zhao, both took to Twitter to confirm the non-binding agreement.

1) Hey all: I have a few announcements to make.

Things have come full circle, and https://t.co/DWPOotRHcX’s first, and last, investors are the same: we have come to an agreement on a strategic transaction with Binance for https://t.co/DWPOotRHcX (pending DD etc.).

— SBF (@SBF_FTX) November 8, 2022

"This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire http://FTX.com and help cover the liquidity crunch," writes Zhao.

This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire https://t.co/BGtFlCmLXB and help cover the liquidity crunch. We will be conducting a full DD in the coming days.

— CZ 🔶 Binance (@cz_binance) November 8, 2022

The agreement does not involve the US arms of either company, with Bankman-Fried insisting that FTX US's "withdrawals are and have been live, is fully backed 1:1, and operating normally".

FTX has faced up to a surge in withdrawals over recent days, raising concerns about its ability to survive.

The exchange's native FTT token fell by 30% on Tuesday, days after Binance said it will dump its holdings of the token.

Tweets Bankman-Fried: "I know that there have been rumors in media of conflict between our two exchanges, however Binance has shown time and again that they are committed to a more decentralized global economy while working to improve industry relations with regulators. We are in the best of hands."