As a result of Binance’s purchase of FTX, the market has been thrown into chaos as traders attempt to comprehend what this development may imply for cryptocurrencies.
Many people who have money on FTX will be questioning if Sam Bankman-vow Fried’s to honor assets 1:1 and that its “assets are fine” will be worth the tweet that it was published in. This is because Sam Bankman-Fried made these statements in a tweet.
Initially, it seemed as if the native currency of the FTX exchange, FTT, was striving to rebound from a drop of 32% that occurred earlier in the trading day. However, it didn’t last very long. As soon as CZ, also known as Changpeng Zhao, posted the news on Twitter that Binance was purchasing the competing exchange, the price began a downward trend that lasted for around one hour.
The price of FTT has fallen by 84% from the beginning of the day and is at $3.55.
Could FTT do a Terra Luna and go to Zero? Yes
Since of the intense selling pressure, and because the run on the exchange is being exacerbated by the sale of the token across all exchanges, there is a growing possibility that the currency may completely lose all of its value. FTT may “do a Terra Luna” and go to zero.
Trading has been a rollercoaster ride today, even by the norms of crypto, which are notoriously volatile.
Because of the significant imprint left by FTX and the Alameda trading house that supports it, the industry as a whole will be significantly altered by its collapse.
Despite the fact that the price of BNB has dropped along with the rest of the market, it seems like the Binance exchange is going to come out on top as the major winner. Binance, which was already the biggest cryptocurrency exchange in the world, will now dominate all of its rivals.
The jitters in equity markets today, against the backdrop of the US midterm elections and the US consumer price index data that is scheduled to be released on Thursday, are making the situation for cryptocurrencies even more precarious.
Compiled by Coinbold