With the continuing controversy between two major crypto exchanges, Binance and FTX, with the former dumpling $500 million worth of FTT, it comes as no surprise that the FTX token’s price and market capitalization are taking a huge hit.
Notably, the market cap of FTT plunged from $2.97 billion to $568.9 million within 24 hours, as the price of FTX’s token dropped by 80% in the same period, based on data retrieved by Finbold on November 8.
Thus, the native token of Sam Bankman-Fried’s crypto trading platform has lost almost $2.5 billion from its market capitalization, losing a staggering 81% in one day, based on the recorded CoinMarketCap chart.
Concurrently, FTT is now changing hands at $4.72, which represents a 78% drop in the day, and a loss of 81.76% across the week, with a cumulative drop of 80.51% over the previous month.
Furthermore, FTT futures trading volume suffered a meltdown as well, as noted by the crypto analytics platform Coinalyze:
$FTT trading volume is thermonuclear today. $3.3 billion so far(futures market). pic.twitter.com/RW5nXwvS5I
— Coinalyze (@coinalyzetool) November 8, 2022
What Hit FTX?
Interestingly, it earlier emerged that Bankman-Fried’s business empire officially consisted of two huge entities – the FTX cryptocurrency exchange and his trading company Alameda Research. The link between the firms was confirmed in Alameda’s financial data which mostly comprises the FTT token.
In response to that revelation, Binance’s CEO Changpeng Zhao announced the firm’s decision to liquidate any remaining FTT on their books on November 6, with which it proceeded later on. Binance sold 22,999,999 FTT worth $584,828,174.
In the meantime, FTX’s CEO took to Twitter on November 7 to say that “a competitor is trying to go after us with false rumors,” adding that:
Buy Crypto Now“FTX is fine. Assets are fine.”
Binance Says There Is No War
Binance co-founder He Yi said recently that:
“The Portfolio Management team at Labs decided to sell FTT based on the risk-control metrics we monitored.”
She denied the allegations that the two crypto exchanges were fighting with one another adding that:
“The point we’d like to stress is that the decision to hold or sell a token depends on one’s own risk appetite and judgment. Our decision to sell FTT is a pure investment-related exit decision, which has nothing to do with “a war,” and we have no intention to engage in drama.”
In other news, the OKX CEO warned that the current happenings might have far-reaching consequences in the future:
“If, unfortunately, FTX becomes another LUNA, nobody in the industry can benefit from the accident, including Binance. Both customers and regulators will lose some confidence about the whole industry. I hope CZ can think about stop to sell FTT and make a new deal with SBF.”
It is also worth noting that, amid all these controversies, BitMEX crypto exchange recently announced the forthcoming listing of two new FTT perpetual contracts on its network, enabling users to trade FTT through its FTTUSD and FTTUSDT listings, “with up to 50x leverage.”
Binance Acquires FTX
With that in mind, in a surprising twist, Binance’s CEO announced later on November 8 that his firm had decided to fully take over FTX to enable them to recover from the current liquidity challenges.
https://twitter.com/cz_binance/status/1590013613586411520
This decision should not just enable FTX to avoid collapse but also prevent a possible far-reaching domino effect across the whole crypto sector that is still recovering from the much-publicized Terra crash.
