March 2, 2024

FTX’s FTT token rallies 30% — Binance effect or FTX 2.0 reopening?

This surge suggests significant institutional attention despite the token’s historical association with FTX’s financial challenges.

Amid market uncertainties around Changpeng “CZ” Zhao’s departure as Binance CEO, the in-house cryptocurrency of the FTX crypto exchange, FTX Token (FTT), witnessed a momentary bull run. FTT surged in market value by more than 55% in the past 48 hours and is currently trading at $4.63, reflecting a 30% increase from $3.56.

FTX’s native token is experiencing another surge following Binance’s $4.3 billion settlement with the United States Department of Justice, according to on-chain analyst firm Santiment. This goes against expectations that FTT would fall in price because it’s the new token representing the FTX crypto exchange’s relaunch (FTX 2.0). The token’s value appears to have been boosted, with the ten largest wallets accumulating $12.8 million in coins in 19 days.

According to Santiment, FTT has recorded 337% growth on the monthly chart, with a significant portion of these gains occurring in the last ten days. Notably, the top 10 whale wallets have been heavily accumulating FTT during this period, leading to a 255% increase in FTT’s market value compared to Bitcoin.

FTX’s recent approach of liquidating assets and transferring substantial funds across different exchanges has triggered heightened activity in the cryptocurrency market. In a significant move, FTX and its affiliate, Alameda Research, executed a remarkable transfer of assets totaling $474 million.

However, this move could generate a depreciating effect on the FTT price. Data from Cointelegraph Markets Pro shows a decent chance to establish a price bottom at current lows since the market is now digesting the bad news.

This move is part of a broader effort to manage the exchange’s financial obligations and potentially pave the way for a new phase known as “FTX 2.0.”  The FTX team plans to restart the exchange by the second quarter of 2024. Notably, this rise in FTT price occurs in the context of Binance’s $4.3 billion settlement with the United States Department of Justice.

Related: Setting new standards for crypto exchanges in the post-FTX era: Report

In contrast, Binance’s BNB token declined, experiencing a 13% drop to $235. Data from DefiLlama showed that Binance’s 24-hour outflows topped $1 billion as of 3:30 pm, Hong Kong time on Nov. 22. The exchange’s net outflows over seven days amounted to $703.1 million.

In his introductory post on “X” (formerly Twitter) as Binance’s new CEO, Richard Teng, who replaced CZ, said that “the foundation on which Binance stands today is stronger than ever.” Teng said he would initially focus on three aspects of the business: reinstating investor confidence, collaboration with regulators and driving Web3 adoption.

Magazine: This is your brain on crypto: Substance abuse grows among crypto traders