The cryptocurrency exchange FTX is facing a potential liquidation of assets valued at $3.4 billion.
Date: 2023-09-11 Author: Dima Zakharov Categories: BLOCKCHAIN
The infamous cryptocurrency exchange FTX is once again in the spotlight, potentially having received court approval to liquidate assets valued at around $3.4 billion next week. Let's delve into the potential implications this may have for the cryptocurrency market.
Bearish Sentiments on the Rise
The announcement of a possible liquidation of such a substantial sum has undoubtedly stirred negative sentiments among market participants. However, this panic may be premature. According to court documents, once FTX receives permission, they will not be allowed to sell tokens all at once. Instead, the company intends to dispose of assets up to $100 million weekly, which can occasionally reach $200 million. The court's decision may either approve or reject FTX's request.
Market Turmoil
A significant portion of FTX's assets slated for liquidation is in Solana. The looming uncertainty has caused concern among SOL holders, leading to a 5.1% drop in the cryptocurrency's price over the past 24 hours. Nonetheless, the consequences of this sell-off may be less severe than some market participants anticipate. Most of the tokens acquired by FTX and Alameda remain locked and will only become fully accessible by 2028.
FTT token, native to the FTX exchange, might face more severe challenges. Considering its limited liquidity and market depth, the liquidation could have a significant impact on its already volatile price.
Moreover, FTX's portfolio includes other popular altcoins such as Aptos (APT), Dogecoin (DOGE), Polygon (MATIC), and Ripple (XRP). However, their amount is minuscule compared to SOL and FTT.
