FTX, a virtual asset exchange currently going through bankruptcy proceedings, is expected to have an impact on the virtual asset market as it sells off its virtual assets to repay its bonds. After receiving approval from the US District Court in Delaware, FTX can now dispose of virtual assets worth up to $100 million per week.
With approximately $3.4 billion (4.5 trillion won) of its $6.2 billion in available assets consisting of virtual assets, FTX requested permission from the court to sell these assets. The company provided a breakdown of its virtual assets, revealing that it holds $1.16 billion worth of Solana (SOL), $560 million worth of Bitcoin (BTC), $192 million worth of Ethereum (ETH), $100 million worth of Aptos (APT), $37 million worth of Tether (USDT), $119 million worth of Ripple (XRP), $49 million worth of BitDAO (BIT), $46 million worth of Stargate Finance (STG), $41 million worth of Rapt Bitcoin (WBTC), and $37 million worth of Rapt Ethereum (WETH).
The possibility of such a large amount of virtual assets being sold off has caused fluctuations in the market. Bitcoin, for instance, experienced a decrease in price from around $26,000 to just over $25,000 after news broke about the court’s decision. However, Bitcoin quickly rebounded, and following the court’s approval of the virtual asset sale, the market did not show a significant reaction. As of now, Bitcoin is trading at around $26,000, while Solana has also experienced a price drop but is now stabilizing around $18.
FTX, which currently has a debt of $8.7 billion, plans to resume its virtual asset exchange operations to revive the company. However, due to the need to service its debt, a significant amount of its virtual assets will have to be sold. Consequently, it is unlikely that the virtual asset market will experience a rebound in the near future.
Regarding potential factors for a market rebound, Kim Min-seung, a researcher at Corbit Research Center, mentioned the approval of a virtual asset exchange-traded fund (ETF) and the Bitcoin halving. However, he noted that the favorable factors for a short-term rebound are uncertain.
Some analysts argue that there is no urgent pressure to sell virtual assets, as the market did not immediately react to the court’s approval of the asset sale. They also point out that certain assets held by FTX are locked for venture investment purposes and cannot be easily sold.
In addition to the FTX asset sales, other factors that could contribute to an increase in virtual asset sales have been identified. Authorities are gradually selling virtual assets seized from the dark web Silk Road and assets recovered in connection with the Mt. Gox hack, further adding pressure to the market.
Overall, the sale of FTX’s virtual assets is expected to have a lasting impact on the virtual asset market, creating a sense of uncertainty and caution among investors. As the market awaits further developments, it remains to be seen how the industry will navigate through these challenging circumstances.
As the virtual asset exchange FTX, which is undergoing rehabilitation and bankruptcy procedures, is selling its virtual assets to repay its bonds, the virtual asset market is expected not to show an upward trend for a while.
On the 13th (US time), FTX received approval from the US District Court in Delaware to sell its virtual assets. As a result, it is now possible to dispose of virtual assets up to $100 million per week.
On the 23rd of last month, FTX asked the court to sell its virtual assets. The company revealed that of the $6.2 billion in assets available for bond positions, about $3.4 billion (about 4.5 trillion won) consists of virtual assets.
The company submitted details of the virtual assets it has to the court on the 11th. According to documents submitted by the company, Solana (SOL) is worth $1.16 billion, Bitcoin (BTC) is worth $560 million, Ethereum (ETH) is worth $192 million, and Aptos (APT) is worth $100 million, $37 million, Tether ( USDT) $120 million, Ripple (XRP) $119 million, BitDAO (BIT) $49 million, Stargate Finance (STG) $46 million. , holding $41 million worth of Rapt Bitcoin (WBTC) and $37 million worth of Rapt Ethereum (WETH).
FTX official website.
The market also fluctuated as the possibility of virtual assets worth trillions of money being won was raised. In particular, as it was recently announced that the court will soon announce whether to approve the FTX sale of virtual assets or not, the price of Bitcoin, which had fluctuated around $26,000, fell to barely more than $25,000 on the 12th .
However, the price of Bitcoin quickly rebounded, and even after the court approved the sale of FTX virtual assets, there is no significant reaction in the market. As of the 14th, the price of Bitcoin is in the low range of $26,000. Solana, which accounts for the largest share of FTX assets, has also fallen in price over the past week, but has recovered and is currently hovering around $18.
FTX announced that it had $8.7 billion in debt at the time of its bankruptcy. After filing for bankruptcy, we are preparing to resume virtual asset exchange operations to revive the company, but it is expected that a significant amount of virtual assets held will have to be sold to service debt.
As it appears that FTX will continue to sell off its virtual assets, analysis suggests that it will be difficult for the virtual asset market to rebound for the time being.
Kim Min-seung, a researcher at Corbit Research Center, said, “Although the market has rebounded, fear will remain in the long term as there is always the possibility of a flood of listings.” I saw it was possible.”
Researcher Kim Min-seung said, “The favorable factors for a rebound include the approval of a virtual asset exchange-traded fund (ETF) and the Bitcoin halving,” but he predicted, “The favorable factors for a short-term rebound are unknown.”
Some analysts say there isn’t really much pressure to sell, considering there was no immediate reaction in the market after the court approved the sale of virtual assets.
Blockchain media CoinDesk shared the view of David Laurent, head of research at FalconX. Laurent pointed out that some of the virtual assets held by FTX are ‘locked’ assets for venture investment purposes, so there are restrictions on their sale.
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Jeff Dorman, chief investment officer of virtual asset investment firm Arca, said the market initially overreacted to the prospect of FTX selling virtual assets, and expressed the view that sales of locked-in virtual assets will be done strategically over time .
In addition to FTX asset sales, factors that would increase virtual asset sales were also cited. Beth Loon, senior analyst at K33 Research, a virtual asset analysis firm, said in a report, “Authorities are gradually selling virtual assets seized from the ‘Silk Road’ dark web, and damaged assets recovered in connection with the hacking of Mt. Gox. also putting pressure on the market to sell “I’m putting it in,” he said.
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