Kategorie: Crypto Markets

Crypto market maker Wintermute has confirmed that it has funds stuck in the embattled crypto exchange FTX. However, the firm has said that the amount of funds held in the exchange is not much and they are within their risk tolerance.

Wintermute further said that the funds will not impact its overall financial standings. The firm said that it has put in place risk controls and efforts to remove some of the funds from the exchange prior to the collapse although some funds still remain.

In a tweet Wintermute said:

“We do have remaining funds on FTX, and while this is not ideal, the amount is within our risk tolerances and does not have a significant impact on our overall financial position.”

Firms allay fears of exposure to FTX

As reported in our earlier news, Coinbase, Tether, and Circle have come out to assure their customers that they are not exposed in any way to either FTX or its sister firm Alameda Research after FTX announced plans to sell itself to Binance in the wake of liquidity crunch.

While Wintermute said that it has funds stuck in FTX, it, however, clarified that it has no exposure on FTX’s native token FTT whose price has drastically dropped since the whole FTX saga started.

Wintermute said:

“As a market-neutral trading firm, we do not have any directional exposure to FTT tokens or related ecosystem assets.”

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Several crypto firms have come out to distance themselves with exposure to FTX crypto exchange and its sister firm Alameda amid the financial crisis facing the two firms. This comes after calls from the crypto community for transparency to let users know if there is any risk.

Tether’s Chief Technology Officer Paolo Ardoino has come out to clarify via Twitter that the Stablecoin issuer does not have exposure to either FTX or Alameda. Replying to Wu Blockchain’s tweet that said “Circle and Tether should disclose more of their financial relationship with FTX Alameda to let users know if it’s a risk,” Paolo tweeted said:

“To be clear: #Tether does not have any exposure to FTX or Alameda. 0. Null. Maybe is time to look elsewhere. Sorry guys. Try again.”

Similarly Circle’s CEO Jeremy Allaire took to Twitter to clarify that Circle also does not have any exposure to FTX or Alameda. In his tweet, Jeremy said:

“Circle has no material exposure to FTX and Alameda.  FTX has been a customer of Circle Payment APIs for the past 18 months, providing card and ACH services for customer transactions.  Circle’s crypto payments beta product uses FTX and other exchanges, for BTC/ETH liquidity.”

Coinbase confirms no exposure despite its shares dropping

The CEO of Coinbase, Brian Armstrong, also took the opportunity to assure customers that the crypto exchange has no material exposure to FTX crypto exchange or its native token FTT. The exchange tweeted saying:

“Second, Coinbase doesn’t have any material exposure to FTX or FTT (and no exposure to Alameda).”

Despite the assurance from the exchange’s CEO, Coinbase’s shares started the day with a −1.75 (3.45%) drop.

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Solana (SOL) is down more than 25% in the past 24 hours as crypto pops amid shocking news developments around the crypto exchange FTX.

SOL price dumps 25% as analyst points to Binance/FTX crypto news

The SOL/USD pair, which was priced above $32 early Tuesday, has touched lows of $24 as selling pressure across the crypto market saw all the major cryptocurrencies turn red on news Sam Bankman-Fried’s FTX was in trouble and Binance had moved in to help by agreeing an acquisition deal.

Ran Neuner, of CNBC Crypto Trader and founder of Crypto Banter, pointed to SOL’s price woes as related to what a Binance deal for FTX means for Solana.

“Solana [is] getting killed,” he tweeted as crypto prices across the market fell.  According to the analyst, the market was just realising that Binance CEO Changpeng Zhao “now owns 10% of the tokens and that he would rather support the BNB chain than SOL.”

He added:

“Also Solana just lost all the support and investment that FTX and @SBF_FTX were making in the ecosystem.”

Solana getting killed. Market realizing that @cz_binance now owns 10% of the tokens and that he would rather support BNB chain than SOL. Also Solana just lost all the support and investment that FTX and @SBF_FTX were making in the ecosystem.

— Ran Neuner (@cryptomanran) November 8, 2022

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Binance is set to acquire the FTX crypto exchange in a surprise turn of events on Tuesday.

Just a day after FTX CEO Sam Bankman-Fried said his company was “fine” and would continue to be so, FTX and Binance have reached a deal to have Changpeng Zhao’s company buy FTX.

Both the Binance chief and SBF tweeted the development, with reference to a liquidity crunch that has seen FTX come full circle as a crypto exchange. Zhao tweeted:

“This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire http://FTX.com and help cover the liquidity crunch. We will be conducting a full DD in the coming days.”

This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire https://t.co/BGtFlCmLXB and help cover the liquidity crunch. We will be conducting a full DD in the coming days.

— CZ 🔶 Binance (@cz_binance) November 8, 2022

Bankman-Fried confirmed the deal was on the table, also tweeting earlier on Tuesday:

“Hey all: I have a few announcements to make. Things have come full circle, and http://FTX.com’s first, and last, investors are the same: we have come to an agreement on a strategic transaction with Binance for http://FTX.com (pending DD etc.).”

1) Hey all: I have a few announcements to make.

Things have come full circle, and https://t.co/DWPOotRHcX’s first, and last, investors are the same: we have come to an agreement on a strategic transaction with Binance for https://t.co/DWPOotRHcX (pending DD etc.).

— SBF (@SBF_FTX) November 8, 2022

The news follows recent reports about Alameda Research’s balance sheet and Tuesday’s massive price dump for the FTX token.

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The price of BIT, BitDAO’s native token, saw a massive drop in the early hours of November 8 where it hit a daily low of $0.3031 before slightly rebounding as the day progressed. At press time, BIT was trading at $0.3888, a drop of about 4.48% in the past 24 hours.

The sudden price drop was a result of fears that Alameda Research, a sister firm to FTX that has been at the centre of the ongoing FTX financial crisis, had dumped about 100 million BIT tokens.

BitDAO has requested proof of funds from Alameda

BitDAO signed a token swap and hold an agreement with quant crypto trading firm Alameda Research on November 2021. Following the agreement, BitDAO swapped 100 million BIT tokens for 3,362,315 FTX tokens (FTT). The two entities had agreed not to sell the tokens for the next three years, which would be up to November 2, 2024.

BitDAO is now threatening to terminate the agreement following fears that Alameda has breached the agreement by dumping about 100 million of the BIT tokens it held after the swap. BitDAO has today filed a proposal asking Alameda to provide proof of funds through an on-chain address.

BitDAO has asked Alameda to respond within the next 24 hours, failure to which BitDAO could take action with the over 3.3 million FTT tokens that it holds after the swap.

In the released BitDAO communication, BitDAO stated:

“If this request is not fulfilled, and if sufficient alternative proof or response is not provided, it will be up to the BitDAO community to decide (vote, or any other emergency action) how to deal with the $FTT in the BitDAO Treasury.”

Alameda says it has nothing to do with the BIT plunge

Responding to BitDAO, Alameda CEO Caroline Ellison has said that the firm has nothing to do with the BIT price fall. The CEO said:

“Busy at the moment but that wasn’t us, will get you proof of funds when things calm down.”

It is unclear whether Alameda will be able to provide the proof of funds within the 24 hours ultimatum that BitDAO gave. In the event the proof of funds is not produced, BitDAO may opt to sell its FTT tokens which would only complicate things for the already stressed native token of FTX exchange.

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