The cryptocurrency market plunged on Monday, following an announcement by the bankrupt crypto exchange FTX. The exchange revealed plans to liquidate its crypto holdings, worth approximately $3.4 billion, causing a widespread sell-off that affected Bitcoin, Ethereum, and several altcoins.
Bitcoin, the largest cryptocurrency by market capitalization, dropped to its lowest level since mid-June, trading at $25,048. Similarly, Ethereum suffered a significant blow, with its price falling to $1,543 - its lowest point in six months. Other digital assets such as ApeCoin, Sui, and Ripple were also impacted by the sell-off.
The downturn followed rumors of a potential sell-off for Solana (SOL), based on FTX's liquidation of millions of dollars’ worth of SOL. The broader market reacted lower to these rumors. Bitcoin fell to lows of $25k while Ethereum slid further below $1,560 with a 3.7% decline. Additionally, BNB and XRP dumped 3% and 5% to touch key levels near $200 and $0.45 respectively.
FTX's bankruptcy in 2022 led to a downward spiral in the crypto market. Former CEO Sam Bankman-Fried is currently facing a criminal trial over the incident. As debtors seek reimbursement for victims, FTX disclosed its current assets and their nominal value as of August 31. Notably, SOL accounted for the largest percentage at more than $1.16 billion.
As per the filing by FTX, the exchange held a total of US$3.4 billion in crypto assets as of August 31, which included:
- US$1.16 billion SOL
- $560 million BTC
- $192 million ETH
- $137 million Aptos (APT)
- $120 million Tether (USDT)
- $119 million XRP
- $49 million BIT
- $46 million STG
- $41 million Wrapped Bitcoin (WBTC)
- $37 million Wrapped Ethereum (WETH)
In addition to these holdings, the exchange has another 438 investment portfolios accounting for roughly $4.5 billion. These amounts have not been added to the previously announced $7 billion. Some of the assets still being tallied include those from Genesis, Yugalabs, and Paradigm.
Meanwhile, over 36,000 customer claims had reportedly been filed as of August 24, with total claims amounting to $16 billion. The current market downturn is seen as a reaction to FTX's liquidation plans and uncertainty surrounding the reimbursement process for victims of the exchange's bankruptcy.
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