The crypto market turned red on Tuesday with huge losses. Some analysts speculated that selling pressure on Bitcoin and Ethereum from FTX’s attempt to increase liquidity against impending bankruptcy caused this cascade of losses.
Some analysis data showed that FTX liquidated its ETH holdings, which put selling pressure on Ethereum and fueled the selloff for Bitcoin. However, despite FTX’s actions in the market to face the tanking of its token FTT, the asset did not recover.
As of November 7, FTT had fallen by 19% and has declined further to 73.04%. The news of FTT’s downfall spread like wildfire across the crypto market and the losses were accompanied. As a result, the crypto market lost nearly $100 billion, down 10% over the past 24 hours, including a 10% drop in the NASDAQ:COIN stock as of late Tuesday.
The massive losses and sell-offs in the crypto market provided an opportunity for some crypto investors to fill their wallets with assets. Kathy Woods’ Ark Investment seized an opportunity to buy 420,000 COIN shares worth $21 million when COIN stock fell on Tuesday. COIN stock is currently trading at an 80% discount.
Binance transaction status with FTX
The FTX trial began with Binance announcing the liquidation of its FTT holdings. But this applies to FTX businesses outside the United States. Coinbase CEO Brian Armstrong, speaking on Bloomberg Television commented Binance’s decision. Armstrong said he would not take the same action as Binance did. According to the head of Coinbase, this move will cut them away from opportunities to acquire FTX US
Meanwhile, Binance has some ties to FTX as its deal with the exchange is not concluded. Both firms need to make some settlement. The CEO of Coinbase further stated that FTX customers will suffer if the FTX/Binance deal fails, which is not good.
How FTX Ordeal Could Affect Cryptocurrency Regulation: Coinbase CEO
It appears that FTX’s loss has turned out to be a gain for Coinbase. According to Armstrong, Coinbase’s customer activity has increased since the news of the FTX issue. He explained that clients patronizing less regulated foreign exchanges are at risk of loss.
The CEO noted that it would be okay for Coinbase not to buy FTX, but declined to provide further details on his reason for saying so. He added that the financial crisis of FTX may not affect the way regulators view the crypto industry. However, this issue will change the regulator’s perception of FTX CEO Sam Bankman-Fried.
Recall Bankman-Fried has maintained an active presence in Washington Congress in its efforts to lobby for crypto industry regulation.
Meanwhile, FTX is currently trading at $4.65, with a live market cap of $619,086,494 and a trading volume of $3,262,989,678.
featured Image From Pixabay, Charts From Tradingview.com