Bitcoin (BTC), Ether (ETH) fall as FTX collapse ripples through market
The collapse of FTX has sent shock waves through the cryptocurrency industry. The price of bitcoin and other major digital coins has fallen sharply as problems emerged at FTX.
Jakub Porzycki | Nurphoto | Getty Images
Bitcoin fell to a week-and-a-half low on Monday, dragging down other major cryptocurrencies, as the fallout from the dramatic collapse of FTX continued to ripple through the market.
Bitcoin was last down 4% to trade around $15,725.02, according to Coin Metrics. Earlier in the day, it fell as low as $15,586.94, its lowest level since November 10. Ether fell 8% to $1,081.56.
The cryptocurrency market has come under pressure in the past two weeks as problems at major exchange FTX came to light.
As of November 6 – the day Binance CEO Changpeng Zhao said his exchange would liquidate its FTT tokens – the crypto market has lost more than $260 billion in value.
FTT is the original token of FTX’s crypto exchange, and Zhao’s decision to sell FTT triggered the collapse of FTX, which has since filed for bankruptcy. Binance was a rival to FTX.
FTX’s new CEO John Ray said on Saturday that the exchange is looking to sell or restructure its global empire.
The company owes its largest creditors around $3 billion.
Crypto markets remain on edge as it is unclear how the FTX saga will end, and whether there will be further contagion across the industry.
“The market is in wait-and-see mode to see if there are any other entities that may fall as a result of being exposed to FTX,” Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, told CNBC.
Investors have been burned by a series of high-profile crypto failures this year that have caused significant ripple effects.
Earlier this year, the collapse of terraUSD, a type of cryptocurrency known as an algorithmic stablecoin, had knock-on effects on a number of companies and contributed to the downfall of major hedge fund Three Arrows Capital.
Amidst the turmoil of the FTX collapse, around $477 million in crypto assets were siphoned from the exchange’s accounts in a suspected hack, according to blockchain analytics firm Elliptic. FTX admitted that “unauthorized transactions” had occurred, but did not provide details of how much money was moved.
Blockchain analytics firm Chainalysis said Sunday that the stolen funds “are on the move.”
The hacker has begun dumping some of their ether holdings into other assets, according to public blockchain records for the account suspected of being linked to the individual. This may be one reason why ether is down more heavily than bitcoin.
“It obviously adds direct selling pressure to ethereum, and it affected bitcoin and other tokens,” said Yuya Hasegawa, crypto market analyst at Japanese crypto exchange Bitbank.
