Investing.com – This week’s slump has continued, exacerbated by Binance’s decision to withdraw plans to acquire cryptocurrency exchange No. 2 in the world and the rival FTX.
The company’s CEO, Binance Changpeng, announced that the world’s largest cryptocurrency company has reached a non-binding agreement to buy the FTX business outside of the United States for an undisclosed amount, to save the company from a crypto crisis. liquid assets. Earlier this year, FTX was worth $ 32 billion as estimated by private investors, as noted by CNBC.
“Initially, we were hoping to be able to help FTX clients provide liquidity,” Binance said in a tweet on Wednesday. The company noted that “the problems are beyond our control or our ability to help.”
It’s unclear who is next in line to buy the struggling cryptocurrency exchange. FTX is facing a shortage of up to $ 8 billion to meet withdrawal requests and is in urgent need of funding.
According to CNBC, Sequoia Capital, one of Silicon Valley’s largest venture capital firms, has invested $ 210 million in FTX. The collapse of digital currencies continues.
It fell back to more than double digits again, posting a 20% loss for the week and losing around $ 16,000 for the first time since November 2020.
For its part, Ethereum has dropped more than 30% in the past two days and is now trying to panic at the $ 1,000 level.
The decline in other assets was further exacerbated as in the case of which it fell by 23%.
Expectations
Experts believe the sector may continue to decline further in the coming days. And this will also affect the actions.
“We believe it is important to highlight the cryptocurrency ‘carnage’ that has driven Bitcoin to its lowest levels since 2020 and could also be a drag on equities, at least in part, as there are investors holding positions in both markets and may have to close their equity positions to counter “margin calls” for their cryptocurrency positions, “noted Link Securities.
“Things like that create short-term forced sales in the market,” says Matthew Hogan, Bitwise’s chief investment officer, commenting on data collected by Market Watch. “Over a period of time that could last months, investors will be reluctant to return to the market for fear of another similar collapse,” concludes Hogan.
