Crypto Market Volatile As News Of FTX Bankruptcy Spreads

In less than a week, FTX has returned to its starting line, but its consequences are clearly visible.

FTX announced today that Sam Bankman-Fried has resigned as its CEO and that FTX, FTX US, Alameda have also filed for Chapter 11 bankruptcy.

In response to this news, the native token of the exchange, FTT has dropped rapidly. At the time of writing, FTT is trading at $2.75.

Not just FTT, Bitcoin (BTC) seems to have shown promise as it reached the $18,000 price zone a day ago, stabilizing sentiment across the crypto market. However, this news caused the BTC price to once again trade well below $17,000.

One detail to note is the moment a company files for Chapter 11, an automatic worldwide moratorium comes into place. Once a company goes into Chapter 11, the management has an exclusive period of 120 days to propose a reorganization plan. Voyager is a prime example before that.

It is unclear if FTX will be able to overcome this situation or if hope has been dashed as the bad situation surrounds the exchange.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Harold

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