Cryptocurrency

FTX’s FTT risks drastic fall as tokens flood exchanges

Glassnode data analyzed by CryptoSlate shows that around 50 million FTX’s FTT tokens were dumped on exchanges after Changpeng Zhao announced that Binance would liquidate its FTT positions in the coming months.

FTX FTT token
Source: Glassnode

About 23 million FTT tokens ($584.8 million) were transferred to Binance on November 6th. CZ Confirmed that these tokens were part of a holding that was being liquidated;

More look-on-chain clearly address of the whale forwarded 491,534 FTT tokens ($10.9 million) lost money to Binance. According to on-chain research, the whale said that on August 5, he bought the token for $29.90, a loss considering the token is trading at around $23 at the time of this writing. I will take it out and sell it.

FTT at risk of significant downside

Given that around 60% of the supply is currently on exchanges, FTT’s value is at risk of falling significantly.

Trading analyst Ali Ajouz has identified $16.5 as the support level for the FTT in the event of a fall. Ajouz makes his predictions based on historical data, suggesting that the coin’s weighted probability value is between $22 and $24.

However, if the coin loses resistance, it could fall below $20.2.

This view was backed up by Alistair Milne, CIO of Altana Digital Currency Fund, who said the token could drop as low as $5.

According to him, if Alameda wanted the token, it would not have made the $22 public offering. Instead, the offer was “not to make $FTT as cheap as possible, but to keep the price from crashing through support.”

but one Analyst says he believes FTT will recover and will remain in the position for a long time. If FTT loses too much value, it could affect his $2.2 billion-plus loan Alameda Research took on his FTT as collateral.

FTT controls FTX holdings

Meanwhile, the Arkham Intelligence dashboard shows that 90% of FTX’s $6.3 billion financing is in its native token, FTT.

According to the dashboard, the exchange holds 245 million FTT tokens worth $5.52 billion. Other crypto assets on FTX include $68.27 million in staked Ethereum, $37 million in Chainlink and $60.16 million in Pax Gold. The reserve does not include the company’s bitcoin holdings.

Our sister company, Alameda Research, has a financial reserve of $165 million. For context, Binance’s finances exceed $43 billion.

Binance US Dollar Supply Hits All-Time High

Binance has continued to cement its top position in the crypto space during the bear market. According to Glassnode data analyzed by CryptoSlate, the supply of the stablecoin BUSD is at a record high on the exchange.

BUSD supply
Source: Glassnode

BUSD Sees Increased Adoption and Growth After Binance Reveals It’s Converting, Removing USD Coin (USDC), TrueUSD (TUSD), and Paxos Standard (USDP) as Tradable Assets on its Platform are enjoying

The exchange went on to convert user balances of these stablecoins into BUSD. Since then, the stablecoin market cap has grown from less than $20 billion to an all-time high of $22.55 billion.

Posted In: Binance, Exchanges

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