Crypto: two cryptocurrency giants go to war and shock Bitcoin and the rest of the market

Crypto : deux géants des cryptomonnaies rentrent en guerre et font chuter Bitcoin et le reste du marché

news material Crypto: two cryptocurrency giants go to war and shock Bitcoin and the rest of the market

Since around 3 a.m. (French time), the cryptocurrency has caused an FTT to trigger a spectacular drop in its price, to say the least. At the same time, the rest of the market followed the fall of cryptocurrency, including Bitcoin. Yet 29th in the ranking, why does this crypto impact the entire market today?

FTT the cryptocurrency of the FTX crypto platform

So unknown to the general public before this event, the FTT cryptocurrency has managed to make a name for itself outside the crypto ecosystem, but not for the right reasons…

Launched on May 8, 2019, FTT is the native crypto token of the 3rd largest crypto trading platform, FTX. This token issued by the platform itself makes it possible to accumulate liquidity while offering advantages to users of the crypto platform – a recurring practice for almost all cryptocurrency trading applications.

While the token was around €22 yesterday, it is now hovering around €15 and doesn’t seem to be stopping in its fall. This spectacular drop of more than 30% even manages to shake the pillars of the sector, namely Bitcoin and Ethereum.

Why is FTT dragging all other cryptos down with it?

This critical situation is explained by a rumor of insolvency on the part of the trading company Alameda Research. This asset manager is owned by Sam Bankman Fried, the founder of the FTX platform and its FTT token.

Concretely, according to information published by the crypto media Coindesk, the equity of Alameda Research was mainly based on the FTT crypto, from the FTX platform. If at first glance the news does not seem so terrible, in reality it is a real problem, especially in the middle of the crypto winter.

Indeed, in the event of a fall in the FTT price (which is not impossible due to the context), the company could very quickly become insoluble. Moreover, its strong proximity to FTX could also cause the loss of the platform, and thus all users would end up on the straw. A not very reassuring signal when you know that FTX is currently the 3rd largest platform in terms of crypto volume.

a flash denial from Alameda and the boss of FTX, the consequences are despite already felt in the sector…

Is Binance taking advantage of this to tackle the crypto competition (FTX)?

Following his suspicions, Binance, the first ranked crypto exchange, announces the sale of all the FTT tokens it held, amounting to approximately $2.1 billion. These tokens resulted in an investment from Binance dating back to 2019.

Following the first sale of part of the tokens (20 million FFT, or $530 million), prices immediately fell by 14%. Although Binance said it wanted to sell these tokens over several months to avoid causing a crash, the news alone served to get everyone offloading their FTTs.

Since then, the FTT has continued to fall, dragging the rest of the market into the abyss. Indeed, the intertwined interest is not reminded of the unfortunate events of Terra Luna. By going from more than €100 to €0 following a “technical problem” with its UST token, the cryptocurrency had created a cataclysm on the crypto market. Last May, all the companies linked to the Terra Luna cryptocurrency had sunk one by one, like Celsius, 3AC capital or even Voyager Digital.

So, a lot of investors fear to relive a similar scenario, but this time with the FTT token.

Others have suggested that the two platforms have gone to war. Indeed, the two are neck and neck in the ranking of the most used crypto platforms and bear witness to the same ambitions (stable token, takeover of banks, etc.)

Nevertheless, Changpeng Zhao, the boss of Binance wanted to deny:

“Binance always encourages collaboration between industry players. As for any speculation as to whether this is a move against a competitor, it is not. Our industry is in its infancy and every time a project fails publicly, it hurts every user and every platform. »

To which the FTX boss replied:

“A competitor is trying to sue us with false rumors. FTX is fine. Assets are good”

In this sense, the war between the two competitors does not seem like such a good idea for either of them, since with the blow of billions, the two giants could cause yet another crash – Bitcoin amenanties and at most down.

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