FTX is bankrupt and has received approval from the court to sell its crypto holdings. These are worth approximately $3.4 billion. The assumption is that it will cause selling pressure on the crypto community at a time when every token is eyeing a recovery from its past losses. For instance, BTC was at $27,085.40 at the time of articulating this piece. This is a significant rise from the $25k mark. It has to surpass the safety level of $30k to assure holders that there is a brighter future ahead.
However, selling crypto holdings of such a vast value is less likely to demonstrate a golden picture. It is unclear if the community will handle this setback patiently or succumb to the pressure.
Ethereum is also eyeing a similar motion within the network. ETH was last seen being traded at $1,650.30. This is good and above the accepted mark of $1,600. BTC’s selling pressure will spread to the second-best crypto token in no time. The actual impact may vary, but there will surely be a negative impact with some pressure to shed the portfolio.
Non-stablecoin cryptos have also broken the trend in the last 24 hours. The BNB token is an exception that has added 1.80% in the week and 0.66% in a short while. It is somewhere around $216.23 on the board. The Bitcoin price prediction is still brighter. Other tokens could face a heavier weight, with the BNB token being one of them. Needless to say, the current bullish scenario is worth enjoying until that moment.
FTX will not let go of the entire holding in a single sitting. The plan is to boat across the unloading dock in a phased manner, tentatively letting everything go by the end of 2023. Solana could also suffer, as FTX has holdings in three main networks: Bitcoin, Ethereum, and Solana. The highest is in Bitcoin, worth $560 million. This is followed by Ethereum, with a value of $192 million, and Solana, at $1.162 million.
FTX has set a $100 million weekly selling cap with the option of raising it to $200 million. This is subject to two communities that its customers represent.
K33, a blockchain research firm, believes that the sale of such a large amount is destined to have an impact. The blockchain research firm has emphasized that altcoins will have a larger impact as it has limited liquidity. Justin d’Anethan from Keyrock has stated that the underperformance could also result from the country’s ETF applications.
Justin has further said that altcoins that are at risk of being called securities are not benefiting from investors’ enthusiasm.
The trading volume of the crypto market has slipped to $17.53 billion, a fall of 12.08%. Market capitalization has touched the mark of $1.05 trillion, a fall of 0.73% in the last day, that is, 24 hours.