Bitcoin traded sideways throughout the week but analysts warn that FTX fallout could affect prices for an extended period of time.
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LEO Token Records Positive Moves While Crypto Market Struggles
LEO, the native token of the Bitfinex exchange, has recorded positive gains as the crypto market struggles to gain footing. The utility token saw a price increase of 4.24% on the day. It also enjoyed an impressive 11% surge in the last 7 days.
LEO’s price surge comes as rival exchange FTX suffers from liquidity issues. After the FTX filed for bankruptcy, many crypto community members called for exchanges to post their proof of reserves. Bitfinex was one of the few exchanges that revealed their cold wallet storage to boost transparency.
However, this move wasn’t a major catalyst in its growth as the tokens of other exchanges that took the proof-of-reserve route are still down. The likes of BNB and Houbi Token are down 5.12% and 16.32%, respectively.
LEO Joins TWT, Toncoin, Chiliz, And Others To Lead Gains
As the crypto market looks to recover, several tokens have enjoyed impressive price rallies. Besides LEO, the likes of Trust Wallet Token, Chiliz, and Toncoin are soaring with daily and weekly gains. Topping the list of top-gainers in the past day and week is Trust Wallet Token. The native token of the self-custody wallet saw an impressive run that brought its total weekly value to over 90%. TWT’s impressive run comes after CZ of Binance endorsed the wallet on Twitter.
Taking second place is the utility token of the decentralized spot and perpetual trading platform GMX. The token saw a week-on-week surge of 20% at press time while holding 2.09% on the day. Toncoin ad Chiliz followed suit in third and fourth place, respectively. Both tokens have enjoyed renewed interest on social media, one key factor contributing to their surge.
LEO came in fifth place, posting an intraday price surge of 4.21%. The Bitfinex utility token experienced some volatility within the week. This pushed the token down to $3.66, a 4.9% drop below its 7-day opening price of $3.82. However, it has recovered the losses, reaching a new local high of $4.22.
Bitfinex CTO Publishes Proof Of Reserve Amid FTX Bankruptcy Saga
Many significant cryptocurrency exchanges, including Binance, OKX, Kucoin, and Crypto.com, committed to publishing their proof of reserve to restore investor trust. The development came after FTX’s liquidity issue became well-known in the crypto space. To demonstrate his commitment, Bitfinex chief technical officer Paolo Ardoino published a list of the most used Bitfinex wallets.
A total of 135 cold and hot wallet addresses were disclosed in Ardoino’s Bitfinex proof of reserves post on GitHub. He provided a list of some of the company’s big holdings, 204338.17967717 Bitcoin and 1225600 Ether, saving users the hassle of going through the addresses.
Back in June 2018, Bitfinex created an open-source framework called Antani. The goal was to promote transparency with regard to evidence of solvency, custody, and off-chain delegated proof of vote. Ardoino revealed Bitfinex’s plans to restore the system to let users see their balances without jeopardizing anonymity.
Featured image from Pixabay and chart from TradingView.com
Price analysis 11/18: BTC, ETH, BNB, XRP, ADA, DOGE, MATIC, DOT, UNI, LTC
Bitcoin and select altcoins are struggling to rise above their immediate resistance levels, indicating that bears remain in full control.
Why Bitcoin Is Not At Risk Of Knocking $10,000 If Grayscale Increases Selling Pressure
The crypto market has seen extreme selling pressure over the past week, with Bitcoin recording a fresh yearly low below its current levels. The number one crypto by market cap is entangled in the collapse of crypto exchange FTX and its subsequent fallout.
As of this writing, Bitcoin (BTC) trades at $16,650. In the last 24 hours, the cryptocurrency records sideways price action with a 5% in the previous week. Other cryptocurrencies in the top 10 by the market are following a similar trajectory and are trending to the downside.
Bitcoin Market At Risk Of Further Downside?
In the collapse of FTX, many companies have had to declare bankruptcy. Contagion is spreading across the nascent industry, which might affect major players, including the Grayscale Bitcoin Trust (GBTC), run by Digital Currency Group (DGC).
The FTX fallout impacted one of DGC’s subsidiaries, crypto lender Genesis. Yesterday, this company halted new withdrawal requests from its customers, citing a liquidity crunch triggered by FTX’s downfall. The company stated:
The default of 3AC negatively impacted the liquidity and duration profiles of our lending entity Genesis Global Capital. Since then, we have been de-risking the book and shoring up our liquidity profile and the quality of our collateral (…). FTX has created unprecedented market turmoil, resulting in abnormal withdrawal requests which have exceeded our current liquidity.
Genesis’ parent company DCG claims it was unaffected by recent events. However, there are speculations about a possible capitulation event within the investment firm and its other subsidiaries, including the GBTC.
One of the largest Bitcoin holders in the world with over 600,000 BTC valued at over $13 billion and 3 million ETH valued at $3.7 billion, if Grayscale or DCG become forced sellers, the crypto market will likely see fresh lows. According to the rumors shared by a member of the crypto community:
We’re hearing semi-credible rumors that Genesis may be having solvency issues (…). We are aware that Grayscale controls GBTC and ETHE, not Genesis. DCG (the parent company of Genesis and Grayscale) is backstopping Genesis, and dissolving the trusts may be necessary if there is a solvency issue, and if it is big enough.
Bitcoin Unlikely To Keep Declining
A separate report from the trading desk QCP Capital claims Grayscale is unlikely to liquidate its Bitcoin holdings. The firm operates under the U.S. Securities and Exchange Commission (SEC) supervision.
QCP Capital believes the SEC is unlikely to authorize a “one-off redemption for Genesis to meet liquidity needs.” The firm noted:
With all of the SEC’s opposition to GBTC this year, we certainly don’t expect this to happen anytime soon. On the bright side this also means a low chance of a large one-off BTC selling pressure from this.
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Trust Wallet Token (TWT) Undeterred Market Downtrends With Over 90% Gains
As calls for self-custody rage on, Trust Wallet Token has enjoyed unprecedented surges in the past week. On TWT’s week-on-week chart, the token has amassed over 90% gains. This comes as FTX’s debacle unfolds and traders grow wary of centralized exchanges. Furthermore, Binance’s CEO endorsed Trust Wallet in a recent tweet, resulting in more interest in the token. While several Redditors mentioned that Binance owning Trust Wallet was a turn-off, it didn’t stop the token from soaring.
TWT also posted substantial gains on the day, with an intraday increase of 4.6%. It reached a local high of $2.34 before settling at its current price of $2.22 press time. Trust Wallet Token’s huge 90% gains undermine the overall market trend that still struggles to recover from the FTX’s collapse. Another catalyst is the recent browser extension launch and Binance and Coinbase integration news.
TWT Launches Browser Extension, Integrates with Top Exchanges
The self-custody Trust Wallet is gaining popularity in the wake of FTX’s demise and the bank run that has affected crypto exchanges generally. Recently the wallet unveiled its eagerly awaited browser extension for PC. It also teamed up with Coinbase Pay and Binance Pay, allowing their users to send money straight to a Trust Wallet account immediately.
The browser add-on was introduced on November 14 and is now accessible in Opera and Google Chrome. The extension enables users to save, transmit, and receive cryptocurrency across all Ethereum Virtual Machine (EVM) chains and Solana. Users may also enjoy a flawless DApp experience without adding networks manually, thanks to a network auto-detect capability. The extension also supports hardware wallets, multiple wallets, NFT, fiat on-ramp providers, and non-EVM blockchain connectors.
Two days after, Binance launched Binance Pay’s Trust Wallet integration. This integration establishes Trust Wallet as one of the platform’s official withdrawal options. Thus users no longer have to scan QR codes to send money to their Trust Wallet accounts. Also, sending to the wallet from Binance won’t cost anything extra besides the blockchain gas fee. The same integration will work for Coinbase Pay. According to Coinbase’s product manager, the integration helps create a “bridge to web3” for customers through seamless self-custody wallet funding.
TWT Soard 90% As Whales Start Accumulating
TWT has enjoyed massive attention following the FTX implosion. But that’s not the only area gaining ground, as it has seen a high capital inflow. As per CoinMarketCap data, the cryptocurrency had a market value of $950.47 million after gaining over $460.27 million in a week. It even reached a local high of $1.11 billion mid-week.
Furthermore, the token is gaining much attention from whales. Since TWT is still relatively cheap, whale accumulation has increased in the past few days. According to Santiment, TWT’s supply rate owned by addresses with a balance of 1,000-10 million TWT increased during its latest run. Although the token’s 24-hour trading volume is down 27%, there’s a chance that it might increase before the trading day ends.
Featured image from Pixabay and chart from TradingView.com
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Is Binance CEO Changpeng Zhao To Blame For FTX Collapse?
In the space of one week, FTX had gone from being the second-largest crypto exchange by trading volume to being bankrupt. This swift move from being ‘okay’ to being in ‘hot water’ has shown just how uncertain things can be in the crypto market. Since it happened, there has been some finger-pointing as participants in the space look for someone to blame, and some of those fingers have been pointed at Changpeng Zhao.
Is CZ The Cause?
The bank run on the FTX crypto exchange had actually started when Binance CEO Changpeng “CZ” Zhao made it public that the exchange was planning to sell its FTT holdings. What would follow was a rollercoaster couple of days that would end in a bankruptcy filing on the part of FTX. But the question remains, did CZ really cause this?
At first glance, it would look as if CZ had actually intended to trigger a bank run on FTX, especially given their public Twitter beef. However, with recent developments, the only thing that could be remotely true is that CZ had accelerated an inevitable collapse.
With an around $9 billion hole, there were bound to be issues with the company sooner or later. Add in the fact that there were already red flags such as Sam Bankman-Fried trying to raise more funds for the exchange and Alameda hemorrhaging money, the die was already cast.
As for CZ, the decision to sell FTT tokens was always a double-edged sword. Yes, the CEO could have quietly sold the tokens but it would have eventually been made public and Binance would be accused of dumping on retail secretly. The second option, which was to openly sell the tokens, was just the last nail in the coffin for an already dying FTX. It was a lose-lose situation.
FTX Not Doing Any Favors
The newly appointed CEO of FTX, John Ray III has already gone to work and the findings have been nothing short of catastrophic. Ray, who had helped energy trader Enron navigate bankruptcy in the early 2000s would go on to say that he had never seen anything like FTX in his career. The level of incompetency at the crypto exchange apparently shocked the Wall Street lawyer so much that he tagged it ‘unprecendented.’
As more information about FTX emerges, it is not hard to see why Ray would say that. From house-buying sprees for FTX employees to executives taking personal loans worth billions of dollars from Alameda Research, how FTX was run is nothing short of a fraudulent company.
Currently, there are reportedly more than 1 million creditors who have been unable to get their funds from FTX. The billions of dollars are nowhere to be found as the exchange enters into full bankruptcy mode. It has also drastically reduced trust in the crypto market. Self-custody is now more popular than ever as investors scramble to put their coins in cold storage.
Featured image from Bloomberg, chart from TradingView.com
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