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The withdrawal of the Binance cryptocurrency exchange from investments in FTX and the intention to get rid of the platform token provoked a fall of the latter by almost 30% on November 8 and a decrease in bitcoin quotes to $19,500. The confrontation of the industry giants in the bear market in the short term threatens significant shocks for the players, Cryplogger respondents said experts.
According to Roman Nekrasov, co-founder of the ENCRY Foundation, the current situation should not be regarded as Binance’s intention to destroy FTX and Alameda Research.
“However, I readily believe in Binance’s desire to pull the blanket over itself, increase the share of its BUSD token in the market due to the fact that many investors in a panic will start entering stablecoins,” he said.
The expert did not rule out that in the coming days or weeks, Binance will change its decision to sell the remaining FTT on the open market in favor of selling Alameda’s own tokens. At the same time, turbulence during this period can be “very uncomfortable”, especially for newcomers to the crypto market who did not catch 2014 or 2018, he said.
“Turbulence is not only a fall down, it is also sharp, poorly predicted surges in prices up. So within a few weeks we may well see a panic sale, and then the buying up of cheaper assets by more optimistic investors,” Nekrasov explained.
In the medium and long term, macroeconomic factors will continue to put pressure on the crypto market: an increase in the key rate in the US and Europe, high inflation and the risk of stagflation.
“In general, nothing good awaits us in the next six months. But the lucky ones can get lucky and ride the waves of instability provoked by the situation around Alameda / FTX, ”the expert suggested.
The head of the Gear ecosystem, Pavel Salas, expressed concerns about the liquidity of FTX, which is significantly inferior to Binance in terms of trading volume. Alameda Research’s proposals to buy back FTT tokens at a price of $22 have not previously met with support from Changpeng Zhao.
“The inability to buy back the token and breaking through the $22 level will most likely lead to an even deeper drop in FTT and further collapse of the entire structure. It will be extremely difficult to get additional loans to maintain the price,” the expert believes.
He recommends observing the situation for a couple of weeks, abandoning short positions in cryptocurrencies for this period. In the event of the collapse of FTX and the subsequent sales of Bitcoin and Ethereum, a fairly strong blow could also await, Salas warned.
Indefibank CEO Sergey Mendeleev believes that such a situation on the day of elections to the US Congress “could not happen just like that.”
“FTX is likely to be rolled out in the end, and if not to bankruptcy, then to very severe liquidity problems. But many have been sharpening their teeth on them since the time of suspicions in the LUNA dump, the collective-unconscious eventually resulted in the current situation, when Alameda was driven to numbers more for fun than for practical reasons, ”he said.
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