Cryptocurrency is a financial market linked only to the value of assets. Therefore, the tokens that appear there can suddenly drop at any moment, with several factors at the origin. This is the case with FTX which spilled a lot of ink for a few hours.
Sam Bankman-Fried at the center of the news
Ethereum and bitcoin are the cryptocurrencies making headlines right now. You should know that they peaked at tens of thousands of dollars a year ago. Today, the fall of these cryptocurrencies is causing the price of all other currencies to fall.
Furthermore, the latest rumors about billionaire Sam Bankman-Fried, CEO of FTX, are adding to the volatility of the market. The latest tweets of the latter have strongly oriented the price of these two cryptocurrencies as well as that of the token of its platform, the FTT, which has suffered a huge drop in the last few hours.
As such, nothing happens by chance, as the CEO tweeted that the assets in their projects are all doing well. Meanwhile, Binance is down with these tokens and cryptocurrencies. Note that Ethereum fell as much as 7% approaching $ 1470 and bitcoin dropped dramatically to $ 19,600.
FTX is a cryptocurrency exchange (among others), like Binance in particular. Note that all of these markets have their own specificities and are therefore in competition with their potential customers. FTX and Binance are two different exchanges that offer cryptocurrency-related services, although the latter is more popular and has more resources than the former.
Problematically, a Coindesk report showed that another Sam Bankman-Fried company, Alameda Research, would be close to bankruptcy if the FTT token were to collapse. In fact, the trading firm alone is said to hold $ 5.8 billion in FTT cryptocurrency, more than that in circulation.
The director finally spoke on Twitter last night. He wanted to ensure the financial health of FTX, so he invited Changpeng Zhao and Binance to work with FTX for the benefit of the ecosystem and its investors who could suffer from this media war.
How to explain the recent autumn?
According to data from Coingecko, the market value of FTT tokens corresponding to the FTX platform evaporated by more than $ 600 million this fall. At present, it is not possible to determine the origin of this sudden drop.
Of course, its big rival Binance seems like the perfect culprit, especially since this incident strangely coincides with the $ 500 million FTT that Changpeng Zhao intends to sell on the market.
However, too hasty conclusions should not be drawn. Other leads can be cited, including a large number of investors selling concurrently, driven by cascading liquidations of leveraged traders.
However, the entire cryptocurrency market suffered from the event. Bitcoin (BTC) fell 5%, while Ethereum (ETH) fell 8.5%. Other victims should also suffer, in particular Solana (SOL), strongly supported by Sam Bankman-Fried, who lost 16% in a few hours.
We will know more tomorrow thanks to the analysis of some blockchain experts. In addition, we will keep you informed of any news by updating this article regularly.