FTX collapse - live: Crypto investors await news as Binance boss compares implosion to 2008 Financial Crisis
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Your support makes all the difference.The fallout from the collapse of FTX continues on Monday, with news that nearly half a billion dollars worth of cryptocurrency has disappeared from the exchange adding to a crisis that has engulfed the broader crypto space.
Binance boss Changpeng Zhao, who goes by the name CZ, has compared the chaos to the 2008 Financial Crisis, which saw trillions wiped from the global market and several established institutions crumble.
FTX filed for chapter 11 bankruptcyon Friday after CZ failed to secure a rescue deal for his rival, citing “issues beyond our control or ability to help”.
Not long after the bankruptcy was announced, nearly half a billion dollars was mysteriously withdrawn from FTX.
The crypto market remains in limbo as investors await clarification on what happens next, with some fearing that they will be unable to recover their assets.
You can follow all the latest news, commentary and price analysis in our live blog below.
Crypto bosses scramble to reassure customers
Bosses of both Binance and Crypto.com have been making public comments today in an effort to calm customers and assure them that their platforms are not about to be the next FTX.
You can read more here:
Crypto firms scramble to stop FTX collapse causing ‘cascade’ of chaos
A surge in withdrawals on FTX last week resulted in a liquidity crisis that it was unable to overcome
BTC and ETH hit records
Amid the chaos, bitcoin (BTC) and ethereum (ETH) have hit records - of sorts.
Data from Glassnode shows that the number of digital addresses holding at least 0.01 of BTC and 1 ETH have just hit a record high.
The figures suggest that either cryptocurrency adoption is growing, or holders are creating new wallets to put their crypto into and diversify the risk of a custodian or exchange collapsing.
Binance to form ‘recovery fund'
In an effort to stop the “cascading negative effects” of FTX’s collapse, the world’s largest cryptocurrency exchange is forming an industry recovery fund to help any of its rivals that are experiencing a liquidity crisis.
“Crypto is not going away,” Binance boss CZ says. “We are still here. Let’s rebuild.”
Binance boss compares FTX collapse to 2008 Financial Crisis
Binance boss CZ has likened the collapse of FTX to the 2008 Financial Crisis, but said that long-term the increased regulatory scrutiny it will likely bring could be “a good thing”.
Speaking during a conference in Indonesia, CZ described the latest developments as “devastating” for the crypto industry in the short term.
Here’s what he had to say:
A lot of consumer confidence is shaken. We’ve been set back a few years. We’ve just seen another very big player going down. Regulators, rightfully, will scrutinize this industry much, much harder, which is probably a good thing to be honest.
Short-term, it’s very painful for retail investors…We feel that pain. But longer-term, this is another wakeup call to say, ‘Look, we are in a new industry. There are a lot of risks and we need to learn how to deal with these risks.
How did we get here?
For a rundown of what actually led to the collapse of FTX, you can get caught up with our explainer here.
All the pieces for the implosion appear to have been in place for some time, but the triggering event was an article in CoinDesk 10 days ago that caused Binance boss CZ to announces that he would be liquidating his firm’s holdings of FTX’s native crypto token FTT.
This led to FTT collapsing in price and a run on FTX’s exchange that led to a liquidity crisis, which ultimately led to its collapse.
Bitcoin price crash: Why is the crypto market in turmoil?
The run on the FTX crypto exchange, combined with the failed takeover attempt from Binance, has resulted in chaos for the market
Hello and welcome...
to The Independent’s live coverage of the fallout from the collapse of the FTX exchange.
Investors are still waiting to find out what will happen with their funds, which FTX claims to have moved into cold storage in order to protect them from hacks or theft.
We’ll be bringing you all the latest news, analysis and comment from crypto experts on the beleagured exchange, as well as any developments in the broader cryptocurrency space.
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