FTX Set to Liquidate $3.4 Billion in Cryptocurrency
The cryptocurrency market is abuzz with anticipation as FTX, a beleaguered crypto exchange, seeks court approval to liquidate around $3.4 billion in cryptocurrencies, with rumors suggesting approval could come by September 13.
This development has stakeholders worried about potential market repercussions.
Bearish sentiments loom, with IntoTheBlock, a crypto analytical agency, suggesting that FTX’s impending liquidation could impact Ethereum and Solana’s recent positive momentum. Notably, other factors like Visa’s involvement and a potential spot ETH ETF are in play.
Despite concerns, it’s important to note that the liquidation may not commence immediately, according to crypto commentator Hitesh.eth. FTX’s court documents outline a gradual approach, selling up to $100 million in digital assets weekly, possibly extending to $200 million.
The situation has raised concerns, particularly for altcoins in FTX’s possession. Solana, valued at $685 million, is a significant part of their assets. This uncertainty has led to a 5.1% price drop for SOL, currently trading around $18.52, in contrast to most other assets that have remained stable or experienced minor dips.
Big selling pressure is potentially coming next week🚨
FTX will likely get approval to liquidate its assets on Sept. 13.
FTX had $3.4B in crypto in April. The proposed plan is to sell assets worth up to $200M per week. pic.twitter.com/4aHnhOVKP1
— The DeFi Investor 🔎 (@TheDeFinvestor) September 9, 2023
FTT, FTX’s proprietary token, accounts for $529 million of the assets to be liquidated, sparking questions about the liquidation strategy due to limited liquidity and market depth.
FTX’s portfolio includes substantial holdings of other cryptocurrencies like Aptos, Dogecoin, Polygon’s MATIC, and XRP.
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FTX is actively pursuing recovery measures, including legal actions. They filed a clawback lawsuit against LayerZero, aiming to recover $21 million. Legal proceedings are also underway against Ari Litan, seeking $13 million in damages, and Skip & Goose, a firm owned by Litan, for $6.5 million.
The now defunct crypto exchange is revisiting promotional fees paid to sports celebrities like Naomi Osaka and Shaquille O’Neal during its peak, reflecting their commitment to recovering assets amidst financial challenges. Osaka, for instance, received $3.2 million for her association and endorsements with FTX.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
