The price of FTX (FTT) has plummeted by 78% in the past 24 hours, as the struggling exchange halts withdrawals and looks set to be acquired by rival Binance. It’s also down by 85% in a week, with its losses beginning after a leaked document revealed that most of FTX’s assets were locked in illiquid altcoins such as its own FTT.
While the rapidly developing situation remains uncertain, the market appears to be acting on the fear that FTX.com is currently insolvent, a suspicion supported by Binance’s move to acquire it. As such, there’s every chance that FTT will fall to $0, or at least very close to $0.
However, while FTT holders still likely have further losses in store, there are certain new altcoins that hold out promise for decent returns in the near future. One of the most promising of these is Dash 2 Trade (D2T), an Ethereum-based trading intelligence platform that is currently holding its presale, and could be in store for a big return once it lists on exchanges.
FTX Token is Spiralling Toward $0
There’s not much to say about FTT that hasn’t already been said, but needless to say, its chart makes for some grim bedtime reading.
Normally, a relative strength index (purple) of 10 would be a signal that a coin is massively oversold, and should be a big rebound sooner or later. However, FTT currently finds itself in less-than normal circumstances, and its descent could possibly be part of an irreversible death spiral.
As of writing, the latest news is that FTX has halted withdrawals, with the prevailing interpretation of this being that it’s insolvent. Such fears have understandably sent FTT even lower, and even Binance’s offer of buying FTX.com appears not to have allayed concerns.
Even if Binance buys FTX.com, FTT could still go to $0 as a result of Binance withdrawing the exchange utility token and/or ending support for it. And while FTX CEO Sam Bankman-Fried has recently said that FTX.us is a separate entity and is fully backed, it doesn’t currently allow FTT trading, so its survival alone will not be enough to save the native token.
As such, things look very grim for FTT, and with the wider cryptocurrency market losing 12.5% in the past 24 hours, the selloff definitely looks set to continue in the short-term.
Can This New Coin Steal All The Limelight?
Pretty much every coin is having to absorb big losses right now. However, there’s one class of coins that’s avoiding falls at the present moment in time and could be set to witness big gains in the coming months.
These are coins that haven’t yet launched and are currently holding their presales. One of these is Dash 2 Trade, a new Ethereum-based trading intelligence platform that will provide investors with real-time analytics and social data in order to help them make more informed trading decisions.
Since beginning three weeks ago, Dash 2 Trade’s presale has raised just over $5.7 million. It presently offers investors the chance to buy its D2T native token at a price of 0.0513 USDT, although this price will rise to 0.0533 USDT once it ends stage three and enters stage four, which will be soon.
As explained by its whitepaper, its Dash 2 Trade’s platform will offer the following tools:
Trading signals that highlight buy and sell opportunities
Social sentiment metrics and on-chain analysis that identify trending tokens
Strategy building and social trading tools that enable investors to adapt new trading strategies
Access to cryptocurrency presales, as well as new listing alerts
Dash 2 Trade has three tiers of access to its dashboard, with the first being a free-to-use version that has the smallest range of features and tools.
However, for a subscription fee of 400 D2T per month, the Starter Tier offers numerous social channels, automated trading tools, and strategy-building tools. Meanwhile, the Premium Tier (at 1000 D2T per month) provides the full range of features, including on-chain data, whale wallet alerts, and professional-grade market indicators.
Given that Dash 2 Trade’s subscription requires payment in D2T, this gives the latter a clear use case. As such, there remains a good chance that, as a result of growing demand, D2T will experience a rising price as Dash 2 Trade becomes more popular with traders.
With other presale coins witnessing big returns this year, D2T has a very good chance of performing well once it lists early next year. It has the fundamentals to succeed and answers to an actual need, so while the market may be in bad shape right now, it’s well placed to ride a rising wave come 2023.
The market is currently in a news-driven environment where the prices of cryptocurrencies have been determined by news agenda rather than fundamentals.
Bitfinex analysts have warned crypto investors to be cautious as bitcoin’s (BTC) recovery over the weekend is not a sign that its correction is over; the asset could witness more bloodshed in the near term.
In the latest Bitfinex Alpha report, experts deemed the market’s reaction this week critical, especially as supply alleviated over the weekend could return when traditional markets open.
“No Man’s Land”
Since Saturday, bitcoin has risen almost 10% from $57,600 to $63,000, closing last week in the green. The asset has surged above the 125-day range low of $60,200, which it broke through earlier this month after news of the German government’s massive BTC selling hit the market.
Market sentiment began to improve after reports that wallets linked to the German government were almost empty. However, the positive sentiment may not be sustained for long as the BTC the German authorities moved to trading desks and exchanges are yet to be sold.
While the supply from Germany appears to have been factored into bitcoin’s market price, Bitfinex analysts believe the end of selling pressure depends on how the involved trading desks execute their trades in the coming days.
Although the shift in sentiment underscores the market’s capacity to integrate new information and adjust expectations quickly, analysts think the market’s reaction over the first two trading days of the week cannot be overlooked for two reasons.
First, the low support level in the $60,200 range has now become a potential resistance line. Second, trading patterns over the past three months suggest that weekends are usually favorable for markets, especially on Saturdays when supply pressure seems to subside.
“We are now in no man’s land until we get clear resolution above or below this level,” the analysts said.
A News-Driven Environment
Besides the potential resistance level and three-month weekend trading pattern, the market is currently in a news-driven environment, where the prices of cryptocurrencies have been determined by news agendas rather than fundamentals.
Since selling pressure concerns are not yet completely obsolete due to upcoming Mt Gox creditor distributions, Bitfinex analysts expect such headlines to continue to have some impact on price movements. As such, the analysts urged investors to exercise caution in their trading strategies.
BlackRock’s IBIT led with $117.25 million in inflows on July 15, also being the most traded Bitcoin ETF.
The US spot Bitcoin ETFs recorded a daily net inflow of $301 million on July 15th. This extended their winning streak to seven consecutive days amidst a broader market recovery.
None of the ETFs recorded outflows for the day.
Bitcoin ETFs Rake in $16.11B in Net Inflows Since Jan
According to the data compiled by SoSoValue, BlackRock’s IBIT, the top spot Bitcoin ETF by net asset value, recorded the largest net inflows of the day at $117.25 million. IBIT was also the most actively traded Bitcoin ETF on Monday, with a volume of $1.24 billion. Ark Invest and 21Shares’ ARKB came in close behind with net inflows of $117.19 million.
Fidelity’s FBTC experienced net inflows of $36.15 million on Monday, while Bitwise’s BITB saw $15.24 million in inflows. VanEck’s HODL, Invesco and Galaxy Digital’s BTCO, and Franklin Templeton’s EZBC funds also recorded net inflows. Meanwhile, Grayscale’s GBTC and other ETFs, such as Valkyrie’s BRRR, WisdomTree’s BTCW, and Hashdex’s DEFI, registered no flows for the day.
A total of $2.26 billion was traded on Monday. The trading volume for these ETFs was less than in March when it exceeded $8 billion on some days. Meanwhile, these funds have collectively attracted $16.11 billion in net inflow since their January launch.
What’s Next For Bitcoin?
Earlier this month, bitcoin’s price decline was mainly due to fears of massive selling pressure from Mt. Gox and the German government’s BTC sales.
But the assassination attempt on pro-crypto former US President and presumptive Republican candidate Donald Trump at Saturday’s rally seemed to spark a recovery in the world’s largest digital asset, and experts are bullish on the asset’s price trajectory going forward. Bitcoin surged more than 9% over the past week and was currently trading slightly below $64,000.
Veteran trader Peter Brandt discussed bitcoin’s price outlook, suggesting a potential major rally. He referred to a pattern he terms “Hump->Slump->Bump->Dump->Pump” and highlighted that the July 5 double top attempt was a bear trap, confirmed by the July 13 close. He sees a likely continued upward trend but warned that a close below $56,000 would negate this bullish view.
“Bitcoin $BTC could be unfolding its often-repeated Hump…Slump…Bump…Dump…Pump chart construction. Jul 5 attempt at the double top was a bear trap, confirmed by Jul 13 close. Most likely scenario now is that bears are trapped. Close below $56k negates this interpretation”
PeckShield alert reveals LI.FI’s protocol vulnerability is similar to a March 2022 attack, with the same bug recurring.
The decentralized finance (DeFi) platform LI.FI protocol has suffered an exploit amounting to over $8 million.
Cyvers Alerts reported detecting suspicious transactions within the LI.FI cross-chain transaction aggregator.
LI.FI Issues Warning After $8 Million Exploit
LI.FI confirmed the breach in a statement on July 16 via X: “Please do not interact with any http://LI.FI powered applications for now! We’re investigating a potential exploit.” The team clarified that users who did not set infinite approval are not at risk, emphasizing that only those who manually set infinite approvals seem to be affected.
According to Cyvers Alerts, more than $8 million in user funds have been stolen, with the majority being stablecoins. According to on-chain data, the hacker’s wallet holds 1,715 Ether (ETH) valued at $5.8 million and USDC, USDT, and DAI stablecoins.
Cyvers Alerts advised users to revoke relevant authorizations immediately, noting that the attacker is actively converting USDC and USDT into ETH.
Crypto security firm Decurity provided insights into the exploit, stating that it involves the LI.FI bridge. “The root cause is a possibility of an arbitrary call with user-controlled data via depositToGasZipERC20() in GasZipFacet, which was deployed 5 days ago,” Decurity explained on X.
“In general, the risks behind routers, cross-chain swaps, etc. are about token approvals. Raw native assets like (unwrapped) ETH are safe from these kinds of hacks b/c they don’t have approvals as an option. Most users & wallets also no longer do “infinite approvals” which gives a smart contract total control on removing any amount of their tokens. It’s important to understand which tokens you’re approving to which contracts.
This dashboard looks for all transactions of a user that intersects Lifi. Not all of these transactions indicate risk- but you can see how, broadly, integrations & layers of tech (like how Metamask bridge uses Lifi on BSC) can complicate how users do or don’t put their assets at risk. Revoke Cash is the most well known approval manager app.
But it’s also good security practice to simply rotate your address. New addresses start with 0 approvals, so starting fresh by moving your tokens to a fresh address is another good security practice.” – commented Carlos Mercado, Data Scientist at Flipside Crypto.
Recent Exploit Mirrors March 2022 Attack
Further analysis by PeckShield alert revealed that the vulnerability is similar to a previous attack on LI.FI’s protocol that occurred on March 20, 2022. That incident saw a bad actor exploit LI.FI’s smart contract, specifically the swapping feature, before bridging.
The attacker manipulated the system to call token contracts directly within their contract’s context, making users who had given infinite approval vulnerable. This exploit resulted in the theft of approximately 205 ETH from 29 wallets, affecting tokens such as USDC, MATIC, RPL, GNO, USDT, MVI, AUDIO, AAVE, JRT, and DAI.
“The bug is basically the same. Are we learning anything from the past lesson(s)?” PeckShield Alert said in a July 16 X post.
Following the 2022 incident, LI.FI disabled all swap methods in its smart contract and worked on developing a fix to prevent future vulnerabilities. However, the recurrence of a similar exploit raises concerns about the platform’s security measures and whether adequate steps were taken to address the vulnerabilities identified in the previous breach.
LI.FI is a liquidity aggregation protocol that allows users to trade across various blockchains, venues, and bridges.
