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The cryptocurrency market finds itself in turbulent waters, as a looming event involving FTX, a major crypto exchange, has many investors anticipating a significant downturn. In recent hours, a substantial number of traders have placed bearish bets on the coins slated for liquidation by FTX, anticipating a decline in their value. This pivotal decision is scheduled to unfold on September 13th, coinciding with the release of the Consumer Price Index (CPI) data.
Whale Analysis shared its perspective, stating, “The altcoin market is experiencing a downward trend, with widespread anticipation of a substantial upcoming sell-off by FTX. Short positions have accumulated significantly in recent hours, especially for those coins set for #FTX’s liquidation.”
FTX is currently awaiting court approval to liquidate $3.4 billion worth of cryptocurrencies. This development has instilled unease among altcoins such as Solana and FTT, as they stand to be directly impacted. FTX is also in the process of recovering funds previously disbursed to prominent sports figures and LayerZero, utilizing legal channels as part of its strategy to address financial challenges.
The altcoin market is going down as people are anticipating a huge upcoming dump from the FTX.
A lot of shorts have been piled up in the past few hours, especially in those coins that #FTX will liquidate.
The decision to liquidate these assets is on Sept. 13, and on the same… pic.twitter.com/Rhep11vHh8
— Whale Analysis (@Whaleanalysis) September 10, 2023
Experts at IntoTheBlock suggest that the FTX liquidation may impede the recent progress made by Ethereum and Solana, remarking, “Despite positive news concerning Visa and the potential launch of a spot ETH ETF, FTX’s impending $3 billion liquidation could exert a substantial influence on market dynamics.”
FTX intends to formally petition the courts for authorization to liquidate its remaining cryptocurrency assets, which encompass a diverse array of digital currencies. These assets comprise approximately $685 million worth of SOL (currently held in escrow), $529 million in FTT, $268 million in BTC, $90 million in ETH, $67 million in APT, $42 million in DOGE, $39 million in MATIC, $31 million in TON, and $29 million in XRP.
The uncertainty surrounding Solana has contributed to an 8.1% decline in its price over the past 24 hours, with SOL currently trading at around $17.99. This stands in contrast to many other assets, which have either maintained stability or experienced marginal declines.
On August 24th, FTX had previously suggested that Mike Novogratz’s Galaxy Digital Capital Management oversee the sale of recovered crypto assets. As per the plan, FTX has the potential to sell up to $100 million in tokens per week, with the option to increase this limit to $200 million for select tokens.
Disclaimer: The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.