{"id":1223,"date":"2022-11-09T18:18:35","date_gmt":"2022-11-09T18:18:35","guid":{"rendered":"https:\/\/solanacrypto.news\/2022\/11\/09\/crypto-markets-plummet-due-to-sense-of-dread-that-hit-clients-of-ftx\/"},"modified":"2022-11-09T18:18:35","modified_gmt":"2022-11-09T18:18:35","slug":"crypto-markets-plummet-due-to-sense-of-dread-that-hit-clients-of-ftx","status":"publish","type":"post","link":"https:\/\/solanacrypto.news\/2022\/11\/09\/crypto-markets-plummet-due-to-sense-of-dread-that-hit-clients-of-ftx\/","title":{"rendered":"Crypto markets plummet due to sense of dread that hit clients of FTX"},"content":{"rendered":"<div id=\"article-main-featured-content\">\n<p>Cryptocurrencies extended declines as Binance\u2019s potential takeover of embattled rival exchange FTX highlighted how strains in the digital-asset industry are now buffeting some of its top players.<\/p>\n<p>Bitcoin, the largest token by market value, fell as much as 7.7% on Wednesday after a 11% decline a day earlier and was trading at about $17,430 as of 8:14 a.m.EST in New York. Tuesday\u2019s low was the least since November 2020. Just about every digital coin was struggling \u2014 Ether, Solana, Polkadot and Avalanche all dropped.<\/p>\n<p>Binance Chief Executive Officer Changpeng \u201cCZ\u201d Zhao stunned the crypto world on Tuesday with <a target=\"_blank\" href=\"https:\/\/www.investmentnews.com\/binance-holdings-plans-to-acquire-rival-ftx-com-228925\" rel=\"noreferrer noopener\">an announcement<\/a> that his firm was moving to take over rival FTX.com, which suffered a liquidity crunch after Zhao announced that he was selling a $530 million holding of FTX\u2019s native token.<\/p>\n<p>Traders cited a Zhao tweet that a letter of intent between the two parties is nonbinding as contributing to the market turmoil. Investors are on edge about spreading contagion given the pivotal role FTX and its co-founder Sam Bankman-Fried played in the industry.<\/p>\n<p>\u201cSince I entered the crypto industry in 2016, very few periods tested its market infrastructure and participants like the last 24 hours did,\u201d said crypto hedge fund manager Dan Liebau of Modular Asset Management.<\/p>\n<p>The sense of dread that swept across clients of fallen crypto exchange FTX.com was so intense that they pulled out $430 million worth of bitcoin in the space of just four days. FTX had more than 20,000 bitcoins going into Sunday, according to data from CryptoQuant. That fell to almost zero by Wednesday after fears about FTX.com\u2019s financial health led customers to flee.<\/p>\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" loading=\"lazy\" width=\"900\" height=\"600\" src=\"https:\/\/s32566.pcdn.co\/wp-content\/uploads\/2022\/11\/AnotherBlow_900x600.png\" alt=\"\" class=\"wp-image-228999\" srcset=\"https:\/\/s32566.pcdn.co\/wp-content\/uploads\/2022\/11\/AnotherBlow_900x600.png 900w, https:\/\/s32566.pcdn.co\/wp-content\/uploads\/2022\/11\/AnotherBlow_900x600-300x200.png 300w, https:\/\/s32566.pcdn.co\/wp-content\/uploads\/2022\/11\/AnotherBlow_900x600-768x512.png 768w\" sizes=\"auto, (max-width: 900px) 100vw, 900px\"\/><\/figure>\n<p>FTT, the utility token of the FTX exchange, has collapsed by more than 75% in the past 24 hours and was trading around $4.20, <a target=\"_blank\" href=\"https:\/\/coinmarketcap.com\/currencies\/ftx-token\/\" rel=\"noreferrer noopener\">according to<\/a> CoinGecko data.<\/p>\n<p>\u201cThe letter of intent is non-binding, which means that further issues could still arise if CZ\/Binance decide to back out of the deal,\u201d said David Moreno Darocas, research associate at CryptoCompare.<\/p>\n<p>The letter of acquisition intent by Zhao\u2019s Binance Holdings came after a bitter feud between with Bankman-Fried spilled into the open. Zhao actively undermined confidence in FTX\u2019s finances, helping spark an exodus of users from the three-year-old FTX.com exchange.<\/p>\n<p>A day before reaching a deal, Bankman-Fried said on Twitter that assets on FTX were \u201cfine.\u201d<\/p>\n<p>Terms of the emergency buyout were scant, with Binance saying the agreement came after \u201ca significant liquidity crunch\u201d befell FTX and the firm asked for its help.<\/p>\n<p>The price of Sol, the native token of the Solana blockchain \u2014 which is associated with both FTX and Bankman-Fried\u2019s crypto trading house Alameda Research \u2014 posted dramatic declines alongside other tokens of Solana-based projects. Sol was down as much as 36% on Wednesday, taking losses this year to 90%.<\/p>\n<p>\u201cSBF and FTX were the biggest patrons of Solana,\u201d Teng Yan, a researcher at digital-asset research firm Delphi Digital, said on Twitter. \u201cThis era is over. Binance has taken over, and they will heavily favor BNB chain over Solana. Alameda had ~$1B in locked and unlocked $SOL, which they\u2019ll have to sell if insolvent. This puts a huge sell pressure on $SOL.\u201d<\/p>\n<p>The FTX-Binance ordeal gave some traders flashbacks to the issues suffered by <a target=\"_blank\" href=\"https:\/\/www.investmentnews.com\/crypto-firms-celsius-network-gemini-face-sec-scrutiny-216452\" rel=\"noreferrer noopener\">Celsius<\/a> \u2014 the crypto lender that collapsed earlier this year \u2014 as well as those seen by other firms that were engulfed in this year\u2019s crash in digital assets.<\/p>\n<p>Teong Hng, CEO at crypto investment firm Satori Research, said the \u201csituation is still very fluid\u201d while adding \u201cI am confident these two crypto giants will do the right thing to protect investors and the industry.\u201d<\/p>\n<p><iframe loading=\"lazy\" height=\"200px\" width=\"100%\" frameborder=\"no\" scrolling=\"no\" seamless=\"\" src=\"https:\/\/player.simplecast.com\/683717b7-3d1c-469e-a3d0-90373077c74a?dark=false\"><\/iframe><\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Cryptocurrencies extended declines as Binance\u2019s potential takeover of embattled rival exchange FTX highlighted how strains in the digital-asset industry are now buffeting some of its top players. Bitcoin, the largest token by market value, fell as much as 7.7% on Wednesday after a 11% decline a day earlier and was trading at about $17,430 as [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":1224,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1223","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/posts\/1223","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/comments?post=1223"}],"version-history":[{"count":0,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/posts\/1223\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/media\/1224"}],"wp:attachment":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/media?parent=1223"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/categories?post=1223"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/tags?post=1223"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}