Crypto Market Tumbles as FTX Liquidity Issues Spark Sell Off
Following crypto powerhouse Binance’s revelation of a nonbinding deal to acquire FTX’s non-U.S. business to aid in resolving a ‘liquidity crisis’ at a competing exchange, prices for cryptocurrencies plummeted, raising additional fears among cryptocurrency investors. This is the most recent emergency intervention in the domain of cryptocurrencies om 2022, as investors fled risky investments in response to escalating borrowing costs.
Tuesday’s announcement of the agreement immediately caused major cryptocurrencies to rise, but those advances were swiftly reversed. Bitcoin, the most well-known and widely used digital currency in the world, was changing hands at 5.50% down at $18,460. Ether, the native token tied to the blockchain of ethereum and the second-largest cryptocurrency, fell by more than 11% to $1,313.
According to CoinGecko, the market capitalization of all cryptocurrencies fell below the $1 trillion level, declining roughly 11% in the previous 24 hours to $952 billion.
“In response to the movements by FTX and Binance, the majority of cryptocurrencies have seen double-digit losses over the previous 24 hours. At $17,166, Bitcoin touched an annual low.
Notwithstanding the hike in interest rates by the US Federal Reserve, Bitcoin has sustained a remarkable performance by holding the bar over $20,000, but on Tuesday it sank substantially.
Ethereum, the second biggest cryptocurrency, plummeted below its support level of $1,300. Several leading cryptocurrencies in terms of market capitalization exhibited a similar trend. The next days will be essential for the whole of the cryptocurrency spectrum “stated Mudrex CEO and co-founder Edul Patel.
Similarly, the price of dogecoin was down roughly 24% to $0.08 today, while Shiba Inu was down approximately 15% to $0.00000010. In the previous 24 hours, the values of Binance USD, Avalanche, Solana, Tether, XRP, Terra, Tron, Litecoin, Uniswap, ApeCoin, Polygon, Cardano, Stellar, Chainlink, and Polkadot all fell. As per CoinGecko, the value of FTT, the utility cryptocurrency of crypto exchange behemoth FTX, fell by over 75% to approximately $5.27.
It was an eventful day for the cryptocurrency market as the founders of the world’s two largest exchanges, Binance and FTX, engaged in a public fight. Due to rising stability issues at the FTX market, Binance Founder said that it will sell all of its FTT holdings. Binance stated later that day that it would purchase competitor FTX, which shook the cryptocurrency market and caused Binance-driven selling pressure. According to the CEO of BuyUcoin, Shivam Thakral, investors are uncertain if the Binance-FTX merger will get completed, which has led to a bigger sell-off throughout cryptocurrencies.