As a seasoned analyst with over two decades of experience in the financial markets under my belt, I’ve seen my fair share of ups and downs, booms and busts. The current situation with FTX Derivatives Exchange is yet another chapter in this captivating saga we call crypto.
Today, FTX Derivatives Exchange, a crypto trading platform that recently filed for bankruptcy, is making headlines as it progresses through the bankruptcy process. According to recent developments and on-chain data analysis, it appears that the exchange has been unlocking some of its Solana (SOL) tokens that were previously staked in Proof of Stake (POS).
FTX and Solana: Genesis
As a researcher, I’ve been analyzing data from Solscan and found that around $24 million worth of SOL (177,693 units) was redeemed by wallets associated with FTX or Alameda Research. The motives behind this redemption are still ambiguous at this point, but the possibilities are under careful consideration.
Initially, it’s crucial for the FTX exchange to secure a good amount of working capital to cover expenses during its current bankruptcy process. Hiring lawyers, paying employees, and associated entities are necessary expenditures that this trading platform finds it prudent to incur.
At its peak, FTX exchange was significantly involved in backing Solana. Via Alameda Research’s investment, the trading platform gained a massive portion of SOL tokens, positioning it as one of the top holders of this cryptocurrency.
When FTX collapsed, Solana felt the strain due to its ties with the company. This strain significantly lowered SOL‘s value following the FTX collapse. Although SOL’s price and operations have since recovered to their levels before FTX filed for bankruptcy, FTX’s impact can still be seen.
After the recent redemption, the FTX exchange holds approximately 7.057 million SOL, which equates to around $954 million in value from staking.
What comes next?
FTX is nearing the end of its bankruptcy process. Notably, they are gathering resources to pay back their lenders. This suggests a strong likelihood that they will soon return the approximately $954 million worth of staked SOL.
Regarding the potential future of FTX, the company is planning a restart to pave the way for a new beginning. So far, details about this are scarce, but it’s important to note that any future Solana liquidations could significantly impact the price of the digital currency.
Currently, Solana’s value is being traded at approximately $134.91, marking a 2.36% increase over the past day. Moreover, there was a significant 9.6% surge in trading volume to around $2,018,446,819, suggesting that the FTX redemption did not instill sell-off concerns about SOL, as is often the case.
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2024-09-12 13:57