Investors’ concerns about the solvency of the FTX cryptocurrency exchange and the safety of its users’ funds led to a drop in the cryptocurrency market.
According to the Cryptovizor cryptocurrency screener, which determines the market price of BTC/USD based on the results of trading on the largest exchanges, the asset fell to $16,893. Thus, the June low of the current bear market was updated.
The problems began on November 6, when it became known that the Binance exchange decided to completely get rid of native FTX tokens. This meant the prospect of selling FTT cryptocurrency worth more than half a billion dollars.
“The experience with LUNA taught us,” explained CEO Changpeng Zhao, referring to the collapse of the Terra project.
In response to this news, bitcoin and the FTT token began to fall. The outflow of funds from the FTX exchange has begun. According to the CryptoQuant analytical platform, 20,000 BTC have left the exchange over the past day.
Today, the head of Binance published an unexpected statement:
“FTX turned to us for help. There is a significant liquidity crisis at the moment. In order to protect users, we have signed a letter of intent involving a full acquisition FTX.com . In the coming days, we will conduct a full assessment of the state of affairs of the exchange.”
It would seem that this is a positive statement. But investors judged differently, and the fall accelerated. As a result, in three months, the FTT token collapsed by 90%, and the decline in the bitcoin exchange rate exceeded 21%.
Amsterdam Stock Exchange trader Michael van de Poppe (Michaël van de Poppe) expressed the general attitude of cryptans to what is happening:
One of the crazy days on the market, and again the weekend [midterm elections in the US], as during the collapse of LUNA. Take care of yourself and your funds, I hope no one will lose in this situation.
As for the lack of losses, he was clearly overreacting: according to the analytical website Coinglass, long positions worth $482 million were liquidated only in the last 4 hours.
