Famous ‘FTX drainer’ trades 20,000 ETH for BTC as Bitcoin price slips to $16,000
- The FTX crisis continues untamed with the transfer of 20,000 ETH to Bitcoin via pure BTC Gateway.
- The new FTX CEO bills $1,300 an hour, while non-CEOs take home $50,000 each month.
- Bitcoin price faces increasing overhead pressure, but bulls hold fort at $16,000.
Cryptocurrencies struggled on Monday amid the ongoing debacle ignited by the collapse of FTX, a crypto empire built by Sam Bankman-Fried (SBF). Bitcoin price is trading down 3% on the day at $16,067, while Ethereum is down at $1,123. Due to this early weekly selloff, the total crypto market capitalization fell 3.4% to $829 billion.
FTX drain triggers another crypto selloff
The crypto market’s underperformance in Monday’s sessions can be attributed to speculation regarding the $600 million drained from FTX a couple of weeks ago. Approximately $72 million in Bitcoin and Ethereum has been moved through the Ren BTC Gate by a person or entity referred to as the “FTX Drainer.”
An article by The Block said that the primary wallet used by the FTX drainer had consolidated approximately 250,000 ETH from other small wallets by Saturday. However, the mysterious hacker started moving the funds on Sunday by exchanging ETH for BTC.
The process involves sending the funds to a new wallet before exchanging Ethereum for pureBTC. This is a tokenized version of BTC created by Ren, a protocol that enables the movement of value between blockchains. After the exchange, renBTC is then connected to the main Bitcoin blockchain via the gateway service provided by Ren.
The FTX drainer traded 20,000 ETC worth just over $22 million in addition to 50,000 ETH ($56 million) converted on Sunday. According to communication made by PeckShieldAlert via Twitter, this person or entity has bridged a total of 4,540 renBTC, worth around $72.9 million.
#PeckShieldAlert FTX Accounts Drainer 1 currently has 200,735.1 $ETH (~$235.5 million) and falls to the 37th largest holder of $ETH (from the 27th)
FTX Accounts Drainer 1 has transferred 50k $ETH (~$58.5M) to 0x866E, then 0x866E traded these $ETH for ~3517 $pureBTC and built out pic.twitter.com/Qokr8bQrvg— PeckShieldAlert (@PeckShieldAlert) 20 November 2022
The FTX manager bills the defunct exchange $1,300 an hour
The new CEO of the collapsed FTX exchange, John Ray, is reportedly billing $1,300 an hour for time spent cleaning up the mess SBF left behind. According to documents filed Saturday in U.S. Bankruptcy Court, experts in charge of restructuring have asked to continue paying salaries to the firm’s senior employees
FTX’s success was undone in early November after an article by CoinDesk publicized a worrying connection to the firm’s trading arm, Alameda Research. Investors rushed to pull their assets out of the exchange after Binance announced that it plans to liquidate $580 million in the exchange’s initial token, FTT – causing a liquidity crisis.
In the last couple of weeks, the walls SBF built to hide the deplorable state of affairs at FTX have crumbled. The documents filed with the court indicate that the CEO bills $1,300 an hour while CEO Kathryn Schultea takes home $975 an hour.
Interestingly, non-employee directors charge the bankruptcy exchange $50,000 per month. Edgar Mosley, managing director of restructuring consultancy Alvarez & Marsal, defended the fees, saying they are “critical to maintaining and managing” the assets FTX still owns and charting a new path into the future.
Bitcoin price is bleeding again
The revelation of FTX drainer activities sent the Bitcoin price into an endless rally where it sought support at $16,000. A recovery seems imminent, with the largest cryptocurrency trading at $16,155 at the time of writing.
BTCUSD four hour chart
If buyers sustain this momentum, Bitcoin could close the day above the 50-day exponential moving average (EMA) (in red) at $16,752. Such a rally in price would also set the pace for Bitcoin to break above the major barrier highlighted by the 100- day’s EMA (in blue) at $17,448 and likely close the gap to $20,000.
