Binance crypto punks12/19/2023 Weekly trading in NFTs has fallen to half of what it was when FTX went bankrupt. One of the hardest-hit corners of crypto is NFTs, made famous by collections like Bored Ape Yacht Club’s cartoon primates and CryptoPunks’ pixelated characters. Approval of a Bitcoin ETF could help increase liquidity as well. “A lot of people have pulled money out of the system or they have money stuck at FTX.”Ī number of crypto exchanges have launched new lending programs in recent months, while several more lending projects are expected to debut shortly, hoping to fill in the gap. That, combined with the erosion of leverage, has sapped liquidity. The number of over-the-counter desks has declined, with mainly the more conservative ones remaining, according to Tegan Kline, co-founder of Edge & Node, which developed a crypto project called The Graph. “It sharply reduced the easy trading profits and exchange fees from retail traders, and also hurt staking, NFTs and other bubble froth.” “FTX was just the climax of a year of crypto credit collapse,” he said. But the fall of FTX, once one of the top crypto exchanges by trading volume, was even more damaging, according to Aaron Brown, a crypto investor who writes for Bloomberg Opinion. Here are some of the ways in which crypto has changed since FTX fell.īy the time FTX went down, the crypto market was already months into the rout that claimed TerraUSD, hedge fund Three Arrows Capital and lender Celsius Network. “We still see crypto exchanges performing brokerage activities - with all the conflicts of interest that entails - and there are still allegations of exchanges commingling customer assets.” “The industry still primarily offers assets that can be made up out of thin air with values that are eminently manipulable,” said Hilary Allen, a law professor at American University Washington College of Law who has written about crypto’s impact on financial stability. Binance, the biggest exchange, still operates without a formal headquarters. The Tether stablecoin, a pillar of the sector long dodged by speculation about the quality of assets backing it and allegations that it’s being used by criminals, has become more dominant in recent months. Some observers see an industry still afflicted by rampant speculation and insufficient safeguards. Read more: Bitcoin Rallies Past Terra Crash Level in Win for Bruised Bulls “People have short memories,” said Jeff Dorman, chief investment officer at asset manager Arca. Perhaps the most tangible indicator that crypto has moved on: Bitcoin has recovered all its losses since the May 2022 implosion of stablecoin TerraUSD, which set in motion the wave of failures that ultimately helped bring down FTX. are moving in, drawn by the prospect of the US Securities and Exchange Commission giving its first blessing for an ETF investing directly in Bitcoin. And large financial firms like BlackRock Inc. Regulators determined not to get caught off guard again are tightening their grip. Same for celebrities and social-media influencers peddling nonfungible tokens and memecoins. Mostly gone are the giddy day traders and the abundant leverage that drove Bitcoin to its November 2021 high at close to $69,000. We laid off most of the team,” Kling wrote.Ī year on, the industry is irrevocably altered - while at the same time in many ways remarkably familiar. Four days later, Sam Bankman-Fried’s exchange filed for bankruptcy, ushering in arguably the darkest days in crypto’s history. “The worst day of my career, and one of the worst days of my life - the day FTX froze withdrawals,” is how Travis Kling, who runs Ikigai Asset Management, described it in a series of tweets on Nov. (Bloomberg) - For many who trade cryptocurrencies for a living, the events of a year ago are forever etched in memory.
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