A new gray cloud over the digital financial market, specifically for cryptocurrencies, has begun to decrease in value due to factors related to the FTX exchange platform and its token. The Profit Edge is a virtual currency exchange and a bitcoin wallet provider.
Many elements make up this new cryptographic turbulence because FTX is one of the leading platforms for crypto trading, which has been linked to financial problems; Sam Bankman-Fried, its founder, has repeatedly denied this situation, indicating that it is just unhealthy rumors.
A bad financial situation in FTX
Solid and complicated situations have surrounded FTX after the recent falls of many companies that seemed reliable in the cryptocurrency market.
One of the most notable cases was that of Celsius, in which the FTX exchange platform suggested the most appropriate thing to do was to contribute to investors to reduce the chances of total capital loss.
In his own words, Bankman-Fried indicates that his investment is not buying shares at the price of pennies but maintaining a client portfolio that took a lot of time, effort, and resources to create and maintain over time.
Unfortunately, this type of investment, together with the complex economic scenario that cryptocurrencies are going through, has meant that FTX ‘s finances cannot withstand the circumstances, heading toward a severe liquidity crisis.
Not only is the company going through financial turbulence, but the FTX token has also decreased in value, exceeding a 45% loss in price, which undoubtedly affected the rest of the cryptocurrencies, including Bitcoin and Ethereum.
The Alameda Research company, which is linked to the FTX Exchange, perhaps with its withdrawals, was the one that disclosed the possible risks in which FTX is found.
The concern, anxiety, and anguish of investors after the financial movements of this great platform ( FTX ) keeps everyone involved with the cryptocurrency market on alert because it is not known what to expect if, with only the possibility of selling to Binance they have crossed the floor that was considered stable to give a new change concerning the crypto winter.
Crypto Market Balance Sheet
The solidity of FTX could be at a point of imbalance that affects not only the shareholders, but also all those users who have deposited their trust and money to carry out their respective crypto exchange transactions.
A few hours ago, Bitcoin decreased its value in proportion to 10%, while Ethereum is between 7 and 8%, leaving the cryptocurrency market with a low balance corresponding to more than 4%.
A rather noisy investment day since many expectations of a change in trend had been deposited for the last months of the year concerning the active crypto market; in addition to adding to this situation, everything related to the United States mid-term elections does not leave much breath for users of digital currencies.
During the investment day, as if it were a chapter of financial comics, Binance came to the rescue, offering FTX the solution to its liquidity problems through the acquisition of the entire platform, which undoubtedly caused the fall of prices will soften after the news.
Because of these circumstances, digital assets are usually so volatile that the news’s impact on them makes them highly vulnerable, where prices decrease and increase very quickly.
Binance deal to acquire FTX
The financial crisis that FTX is going through is quite considerable, which is why the willingness of Binance managers to acquire said platform arises; the objective is to recover the finances of the digital company and protect all its users.
After the announcement by Binance, cryptocurrencies such as Bitcoin, which had reached $18,600, managed to recover and touch $20,000 again, which has been considered the support level for several months.
FTX has been the victim of many rumors and disclosure of financial information where the platform could have an imbalance between liabilities and assets, as their commitments seem to exceed their holdings.
Conclusion
It is interesting how the convulsions of the market demonstrate the fragility and strength of the cryptocurrency platforms that, throughout the development of the crypto market, have struggled to maintain their place as solid platforms in such a new and unregulated market.
It represents another element that could generate great market expectations after the US mid-term elections.
