The previous week was without a doubt the most difficult, shocking, and devastating in a long time. After refusing to accept customer withdrawals and disclosing a multi-billion liquidity hole, one of the biggest cryptocurrency exchanges in the world, FTX, filed for a voluntary Chapter 11 bankruptcy with the US.
Due to the former CEO Sam Bankman-complete Fried’s lack of transparency, it is unclear exactly how it all happened or when FTX started experiencing problems. The amount of money the exchange has been transferring to the SBF-owned trading company Alameda Research, which is also involved in the bankruptcy proceedings, is also not well known.
The exchange has prevented hundreds, if not millions, of people from accessing their cryptocurrency assets, and it is yet unknown whether and when they will be able to receive any of it back.
Many participants are in disbelief, predicting even tougher times ahead as contagion will start spreading in terms of valuation also in terms of regulation. This is a clear blow to the industry’s integrity.
It’s important to remember that Binance signed a LOI to fully acquire FTX but backed out after doing due diligence. According to CZ, there is too much of a hole in the exchange’s book to continue.
As the bankruptcy process gets underway and moves along with the appropriate authorities, additional information and specifics will undoubtedly be disclosed. SBF has since stepped down as CEO.
Naturally, the news was poorly received by the market. The price of BTC is currently $16.7K, down 17% for the week as of the time of this writing. Ethereum is down 19%, BNB is down 15%, XRP is up 18%, DOGE is down 32, DOT is down 13, SOL is down 46, and so on.
With a loss of $160 billion in just seven days, the market capitalization of all cryptocurrencies fell to $880 billion. Additionally, the FTX Bankruptcy proceeding also involves some 130 entities with whom the company was affiliated, and the concern regarding industry contagion is at an all-time high.
Market Cap: $881 billion
24 Hour Volume: 110 billion
BTC Dominance: 36.4%
BTC: $16,731 (down 7%)
ETH: $1,260 (up 19%)
BNB: $284 (down 15%)
News about cryptocurrency this week You Can’t Miss
FTX and Alameda Declare Insolvency, and SBF Steps Down as CEO. FTX, one of the biggest and most well-known cryptocurrency exchanges in the world, has collapsed. The business submitted a voluntary Chapter 11 bankruptcy petition to US authorities together with 130 of its affiliates.
A timeline of a high-profile bailout that never took place for the botched acquisition of Binance-FTX. After reviewing FTX’s paperwork, Binance made the decision not to proceed with the acquisition. A timeline of what happened is provided below.
BlackRock and Tom Brady are just a few of the investors and partners in FTX. FTX had a very broad list of investors, some of which were funds run by BlackRock, the largest asset manager in the world. Additionally, the organization has been able to bring on a huge number of celebrities.
Following the FTX Crisis, JPMorgan believes Bitcoin might plunge to $13,000 in price. According to JP Morgan, the FTX situation may cause Bitcoin’s price to drop to $13K. Early in the week, the asset already started to decline toward $15,000.
In the FTX liquidity crunch, Canada’s Teacher’s Pension Fund is having investment problems. The Canadian Teacher’s Pension Fund is another organization that suffered losses as a result of FTX’s demise. During a $420 million investment, the fund made an unknown sum in the company.
