Tomorrow, September 13, there will be a hearing on the application of the bankrupt FTX to sell tokens from the balance sheet to pay off its debts.
If this application is approved, then bankrupt FTX will sell tokens totaling more than $3.4 billion on the market.
FTX representatives have already stated that they plan to sell cryptocurrencies from their balances in the amount of up to $200 million every week.
🧠 How could this affect the market?
To answer this question you will have to resort to simple mathematics.
If FTX is going to sell $200 million worth of crypto per week, then it will take 4 months to completely clear the balance. Considering that during this time the market should fall, clearing the balance will take place faster, in about 2.5-3 months.
As you can see in the picture (the amount of tokens is indicated in millions of dollars), the FTX exchange most of all holds SOL, BTC and ETH tokens on its balance sheet:
🔹1. $SOL
The current capitalization of the circulating supply is approximately $7.4 billion.
Of this supply, approximately 15.7% is held by FTX. It turns out that, at a rough estimate, the FTX exchange will sell slightly less than 1% of SOL tokens from the total circulating market supply every week.
This will put very high pressure on this coin, so it is very early to buy it. We will probably see the $10 mark and this is at least.
💰 2. $BTC
The current capitalization of the circulating supply is approximately $502 billion.
Of this supply, approximately 0.1% is held by FTX. It turns out that the weekly pressure will be only $145 million.
On the one hand, this is a very low value and under other circumstances would not affect the market at all. On the other hand, there is very little liquidity in the market now and such things can provoke a small wave of liquidations, which can develop into panic.
Overall, we believe that such pressure will not have much impact. However, in the following posts you will understand that everything that is happening is forming like a snowball, which quite significantly sucks liquidity out of the system
🔹 3. $ETH
The current capitalization of the circulating supply is approximately $189 billion.
Of this supply, approximately 0.1% is held by FTX.
Here everything turns out exactly the same as with Bitcoin, so we see no point in repeating ourselves.
💩 4. Other tokens
But here the situation is more interesting. At a rough estimate, FTX has approximately $1.486 billion in tokens on its balance sheet in addition to those listed above. And the total capitalization of all coins except the TOP5 is approximately $110 billion.
It turns out that with alts it will be the same story as with SOL.
📊 Conclusion:
If the application is approved tomorrow, then for approximately 2.5-3 months there will be weekly pressure on the market from FTX (about other sellers in the following posts). Moreover, there will be strong pressure specifically on SOL and on most altcoins.
Altos are already showing terrible dynamics this year, overwhelmingly continuing to update the bottom.
And we are silent about other sellers and ordinary traders who are heavily dependent on psychology.
Therefore, buying alts now in the medium to long term is a very bad idea. Maximum speculation with stops.
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