FTX and Alameda’s Ponzi-like trading plan has deeply hurt the cryptocurrency industry. However, there are events to follow after the FTX bankruptcy. As Koindeks.com, we present to you three developments that should be followed closely.
What can happen in the cryptocurrency markets?
Until the beginning of the week, Bitcoin was showing very low volatility. In addition, it experienced rises with the developments in altcoins. At the same time, on-chain data and technical analysis reported that BTC is in the middle of establishing a baseline. However, many analysts believed that the bullish action was coming.
However, the increase in volatility in the market after the recent events reveals that there is a “Black Swan” event. According to many crypto analysts, both FTX and Alameda caused a scam. The stock market abruptly stopped withdrawal processes due to “not being able to work as usual”. “We are suspending customer withdrawal processes that are permitted under our terms,” it said. Following these statements, the confidence of users seems to have been shaken.
Stablecoins are in danger
According to analysts, at the moment, it is difficult to make a short-term investment thesis for cryptocurrencies just by looking at the chart. It is stated that the best thing investors can do is stick to a time-bound plan. The most likely short-term outcome is priced as volatility remains high. According to experts, cryptocurrencies are expected to fall for a while. During high volatility events, stablecoins sometimes diverge from their stablecoins with the dollar. A development or a crazy FUD about Bitcoin leads investors to stablecoins pegged to the dollar. As a result, stablecoins rise above $1.
During the Black Swan events, Tether (USDT) loses the dollar rate. It happened a few times before, and then it regained its stability again. According to information provided by TradingView, on November 9, USDT fell below its stable. With the decline, it fell as low as $0.97. USDT broke from its stable, while the value of USD Coin (USDC) rose to $1.01.
The most important point in the crypto money markets is the information that is not absolute. False information, rumors and bullshit cause panic. Afterwards, it easily triggers the users in the market. That’s why experts say rumors about Alameda and Tether should be investigated.
A similar phenomenon was seen in the Terra and Celsius crises. TradingView shows that on May 12, the price of USDC rose from $1.00 to $1.06 and subsequently to $1.19. On the same day, the price of USDT briefly declined to $0.98 and $0.94.
How will the Bitcoin price react?
The sell-off on November 8th finally dropped BTC from $24,500. With the events that followed, it was outside the 146-day range where it fluctuated in the middle of $ 18,600. As developments regarding FTX emerged, the price of Bitcoin fell as low as $17,100 seen in June. Analysts hope that Bitcoin will reclaim $18,000. It is expected that the price will return to the previous range at least after it can hold from here.
Ethereum (ETH), on the other hand, fell from the 148-day range in the mid-$2,000 to $1,250 range. Along with it, it reflects an example of my council. But the price has essentially reclaimed the previous range. Analysts state that ETH has a bearish aim in the $700 range. However, it is necessary to wait for the price to recover and process around $1,250. Cryptocurrency market is looking for a more solid foundation
Companies exposed to FTX in cryptocurrency markets
The liquidity crisis in FTX has caused significant problems, especially in the crypto money companies that are in contact. The companies currently at risk are as follows:
- -Sequoia Capital – $213.5 million in risk
- -Galaxy Digital – $77 million loss
- -Crypto.com – Has less than $10 million contacts
- -Amber Cluster – 10 percent loss of funds
- -Kraken – Exposure to 9k FTT
- -Mulcoin Capital – 10% loss of funds
- -Selini Capital – owns 3 percent of its funds
These are just the losses of crypto companies. There are also a variety of valuable altcoins and decentralized finance (DeFi) tokens. According to analysts, many of these BTC, altcoins and DeFi tokens are likely to find their way to market on spot exchanges in order to recover existing losses, settle their own loans and meet customer obligations.