FTT Token remains one of the worst performers in the crypto market this week. The token is already down more than 80% from its last week’s price and continues to show very bearish trends. Now, there has been some recovery for the token in the last day but the volatility still remains high. The price of the coin is yet to hit below zero like LUNC did but the collapse of the FTX exchange suggests that this may be the next LUNC in the making.
A Gambler’s Token
Over the last couple of days, the profitability of FTT tokens has taken a hit. It had fallen to a cycle low of $2, leaving billions of dollars in losses in its wake. This has pushed the total market cap of FTT down below $630 million and its fully diluted market cap at around $673 million as 100% of the token supply was reported to be already fully unlocked.
One development that goes against the declining trend is the volume of FTT tokens being traded. Just like LUNC after the collapse of the Terra network, some investors have taken to trading the token in hopes of benefitting from the high volatility that followed.
In the days following the FTX issues brought to light, FTT trading volumes had crossed $1 billion. The shorts had piled up mostly but there had been some longs, as well as spot buying across other exchanges asides from FTX by users who believed there was some recovery to come.
FTT token drops more than 80% since FTX collapse | Source: FTTUSD on TradingView.com
A look at the FTT token chart now shows wild volatility in the digital asset. These movements are far-flung and switch to each side drastically. In the last 24 hours, the price of FTT has tethered between $3 and $4 as the ‘gambling’ continues.
Can FTT Recover?
Just like LUNC, the recovery of the FTT token depends on the ability of the issuing platform to weather such a storm. Since Terra network did not recover from the collapse, LUNC’s price has not been able to recover to even 1% of its previous price.
More developments are still coming out regarding the FTX case, like the exchange reopening withdrawals at one point, but rumors are that there is likely a $10 billion hole in the crypto exchange’s balance sheet due to the bailouts of its sister company, Alameda Research.
From the present vantage point, there is no way that FTX will come out of this unscathed, especially since Binance pulled out of the acquisition deal. FTX is also reportedly being investigated by the authorities, which adds more salt to the wound.
FTT token is likely to continue trending low from here on out, falling into the background of maybe a ‘meme coin’ status as investors in the space gamble on it. However, the chances of FTT returning to its previous prices, especially during a crypto winter, are incredibly slim.
Featured image from Kalkine Media, chart from TradingView.com
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