Forex news

Cryptocurrency Meltdown Pauses After FTX and Alameda Implosion.

FTX’s collapse continues to reverberate throughout the crypto space. FTX and Alameda Research are two companies that have been linked in recent weeks, and both firms have suffered major losses due to their failure to operate as expected. While the collapse of Terraform Labs was the first big event to impact the crypto industry, FTX and Alameda Research were the second. They both faced regulatory scrutiny for their failure to meet their respective standards, and both firms took a huge hit after the sister tokens of Terraform Labs imploded.

Alameda Research has a significant amount of FTX Token (FTT) that they have been loaning to the exchange. This caused a run on the exchange’s native token, and forced Binance to rethink its plan to rescue FTX. However, the company’s liquidity crunch was caused by bad leverage and risky trading bets. According to CoinDesk, FTX was lending Alameda a lot of its own token to cover risky trading bets, despite a contract that prohibits them from doing so. The FTX exchange has since filed for bankruptcy protection in the United States. The bankrupt company plans to file a list of 50 largest creditors this week.

While the news broke earlier this week, it has only begun to impact the crypto world. FTX was valued at $32 billion in a funding round earlier this year. However, as it became more apparent that FTX wasn’t what it seemed, Binance pulled out of the deal. It was believed that FTX could be rescued if Binance bought FTX’s non-US unit. However, Binance decided not to proceed with the deal after a review of FTX’s books.

FTX, a crypto exchange that was launched by Sam Bankman-Fried in June, filed for bankruptcy protection in the United States on Friday. The company has been under multiple federal investigations. It may have more than 1 million creditors, and it plans to file a list of 50 largest creditors this week. It may have lost billions of dollars, and the collapse of FTX may have a cascading effect throughout the crypto world.

The collapse of Terraform Labs and FTX has affected the entire crypto industry, as FTX’s sister tokens suffered significant losses due to their failure. The failure of Alameda Research and FTX has also prompted regulatory scrutiny, and has led to withdrawals from crypto-lending programs. It’s also a classic case of contagion. The failure of one firm can cause a rush to redeem money, leading to a cascade of closures.

The cryptocurrency meltdown was expected to pause after the collapse of FTX and Alameda Research. However, the CoinDesk story has raised more questions about the two firms. It’s also revealed that FTX was lending Alameda a large quantity of its own token, FTT, to cover risky trading bets. The FTX token, Serum, was also promoted by FTX.

It seems that Bankman-Fried was involved in the creation of Alameda Research and FTX, and it’s unclear whether he had any involvement in their collapse. However, his personal wealth suffered a 94% drop on the day he resigned from both firms. He’s also reportedly looking to sell his $40 million penthouse in the Bahamas.