It’s only been a day since FTX’s FTT fell, but now the token seems to have a massive dump of $3M after Bybit exchange announced it would sell FTT tokens in response to Alameda selling BITDAO BIT to save the FTX exchange’s cryptocurrency. The selling pressure between BIT and FTT has caused a 20% loss and Solana’s ecosystem suffers from a serious breakout.
Just when Solana was to become the ecosystem of the year, the clash between FTX-Binance and BitDAO pushed its NFT and crypto coin to its support level. Despite it being a strong ecosystem, the SOL has failed to maintain its good price.
The fall of FTX Token
For those who aren’t familiar with the situation, the FTT token has been a strong crypto coin in the market as it was the native token of the FTX exchange, one of the largest trading platforms in the world. However, now, it’s become the most vulnerable coin in the market.
The price of FTT began dropping from around $26 and fell 46% to around $15. The coin had weekly support between $21-$24 before the crisis and traders were actively trading on this level. However, it declined below its support level to $15, and overnight the coin fell even more. Currently, FTT is trading at $2.30 with a high of $5.10.
The reason is mentioned above but to explain it better. BitDAO and Alameda Research signed a deal in which the institute converted around $3.36M FTT into $100M BIT and agreed it won’t sell for 3 years.
Since now 3 years are up, BitDAO is a bit nervous about whether Alameda will dump BITs to save FTT, so the organization warned the institute that if it tries to sell BITs, it will let go of its FTT tokens. The members also asked Alameda to provide on-chain proof that they still have BITs or not. Caroline, the company behind Alameda, came on Twitter and shared the team will readily share the evidence.
As soon as this news broke out, the FTT and BIT dropped, causing a massive loss to FTX’s tokens. A few hours later, the firm provided bitDAO with proof that it had $97M BITs in its storage, so the situation was resolved. Nonetheless, FTT failed to gain its previous momentum and is down again.
Effect on Solana ecosystem
Solana’s ecosystem isn’t doing quite well as SOL crashed 28.85% in the 24h chart while the NFT value is also dropping drastically. The system seems to have fallen prey to FTT token dump since Alameda has a huge investment in Solana. Its other listed coins such as Serum (-53%), Solend(-30%), Raydium(-58%), and Bonfida(-47%) are also down.
Its native token, SOL prices have dropped from $37 to $15. Currently, the coin trades at $15 with a low of $12.51. There’s a huge volatility in its momentum, showing the instability of the overall market.
Is FTT the next LUNA collapse?
A lot of people speculate that FTT is a long-gone coin with no hope, especially after last night because instead of recovering, it was dumped by Bybit, causing even more damage. Within two days, FTT has failed to climb up, which gives a flashback to how Terra collapsed.
However, compared to LUNA, FTT is going strong. Alameda is trying to save the coin seeing the extended timeline of its survival. Although FTX hasn’t shared any details about this, the team might be working to bring it back behind the scenes.
If FTT manages to recover from this loss, it will prove to the market its strong volatility and also defend its position as an exchange among users. Until then, nothing can be said.