Why Did FTX Cryptocurrency Fall?

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The crypto market hosts many different crypto assets. Some of them are released by popular crypto platforms; for example, the WBT token belongs to the WhiteBIT exchange, BNB to Binance, and FTT to the FTX exchange. In November 2022, the FTX token lost its value significantly and also caused another drop in the entire market. In this article, we will talk about the main characteristics of crypto assets and look closely at the FTX token.

What are the Main Characteristics of Crypto Coins?

Looking at the crypto ranking on Coinmarketcap, we can see the list of assets placed according to their capitalization, price, and trade volume.

  1. The market cap for cryptocurrency. It indicates the total sum of all the coins released and in circulation. To get the cap, you need to multiply the current value by the number of coins.
  2. Price – current crypto rates
  3. Trade volume – the number of trades made with a specific crypto asset in a specific time period. Usually, they take trades made in the last  24 hours.

Market cap crypto depends directly on crypto price and the number of assets in circulation. When the price falls, the market cap drops too. That is what happened with the FTX token in November 2022.

What Happened with the FTX Token?

On November 2,  the news released by the CoinDesk resource shook the whole crypto market. They claimed the Alameda company held FTT tokens worth $5,81 billion, which is a significant part of all the company’s assets ($14,6 billion). That should not be so because a company mustn’t keep most of its own tokens but add other companies’ and project currencies. The fact is that FTX exchange is a subsidiary of Alameda.

This news caused the massive withdrawal of funds from the FTX exchange, which caused the FTX token to drop from $22  to $1.33 on December 1.

Pick reliable and trustworthy crypto exchanges for trading, such as Binance, WhiteBIT, and ByBit.

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Darrik Ferranti
I'm a crypto and blockchain geek. That interest has recently driven me to get into online betting using crypto. Writing about those topics is a good way for me to learn more while helping our audience learn at the same time.