Does FTX Token (FTT) have a future in crypto?
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The FTX Token (FTT) has had an interesting couple of weeks. Its fate remains unclear, but as things stand, its outlook isn’t good. FTX Trading was the world’s third-largest cryptocurrency exchange, worth $32 billion, with a token that peaked in September at $85.
Unfortunately for all involved, the platform is now suffering from a severe liquidity crisis with the value of its token dropping significantly. At time of writing, its assets have been liquidated and the FTT token has been trading under $2.
So, what happened and are there any ways other cryptos could avoid a similar fate?
FTX trading was incredibly popular and well-liked by users and investors. Its native FTT offered high scalability and speed, and these aspects, combined with its reliability meant it was particularly popular with companies.
After peaking in September 2021, the FTT token, like thousands of others, entered the bear market in November as crypto winter began. In June this year, it seemed to find a new baseline, trading between $20 to $30.
Things started to unravel after a Coindesk report on the 2nd of November revealed close ties between FTX Trading and a company founded by FTX’s CEO, Sam Bankman-Fried, called Alameda research. This ignited a public Twitter feud between Bankman-Fried and Binance CEO Changpeng Zhao.
The result was Binance selling all its FTT holdings, worth around $500 million. The sale sparked a colossal market sell-off, with $6 billion being withdrawn form FTX in less than three days.
After a phone call between the two CEOs and a realization of the wider consequences of the situation, Binance said it would buy FTX to protect
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