Cryptocurrency prices plummeted amid reports of FTX bankruptcy. Changpeng Zhao, the founder and CEO of Binance, the world’s largest cryptocurrency exchange, announced on Sunday that his trading platform is about to sell its stake in FTT, a competitor platform to FTX’s native asset.
Given that Binance CEO Changpeng “CZ” Zhao is selling off the native coin, FTT, he mentioned “new disclosures that have come to light,” but he made no further public mention of them or responded to questions about them.
In a subsequent tweet, Changpeng Zhao stated that the FTT liquidation was “merely post-exit risk management,” citing the lessons learned from Terra Luna Classic’s (LUNC) collapse and the impact it had on market participants.
“We will not assist persons who advocate against other industry participants behind their backs,” he added.
However, Binance’s decision may have been influenced by a recent balance sheet statement from Sam Bankman-Alameda Fried’s Research. According to this statement, Alameda’s assets are worth billions of dollars and are linked to the FTX coin.
FTT Price & Tokenomics
The current price of FTX Token is $16, with a $1.1 billion 24-hour trading volume. FTT has dropped by more than 28% in the last 24 hours and more than 35% in the last seven days. CoinMarketCap is now ranked #30, with a live market cap of $2 billion.
FTT Price Chart – Source: Tradingview
Being Divided in Their Opinions
For weeks, Sam Bankman-Fried, the CEO and creator of FTX, has been chastised for legislative suggestions he made in an earlier piece that recommended restrictions on DeFi. These criticisms have been addressed by Changpeng Zhao. He has since promised to reconsider his stance on the legislation. Meanwhile, Binance purchased the FTT funds last year as part of its exit from an earlier equity investment in FTX that it had held since 2019.
According to Zhao, FTX paid $2.1 billion in FTT and BUSD, the stablecoin that is only available on Binance’s market, for Binance’s stake in the company. Changpeng Zhao predicted that due to market conditions and a lack of liquidity, the liquidation would take many months to complete. Furthermore, he stated that it would be carried out in such a way as to minimize the impact on the FTT market.
However, according to reports, FTT, which had risen from a low of around $22 on Sunday, has dropped 9.5% in the last day, from $25.55 to $23.03. On Saturday, Etherscan reported that 22,999,999 FTT, worth $584 million at the time, were transferred to Binance’s exchange. It represents exactly 17% of the current supply of FTT.
Alameda’s CEO Explains Their Financial Situation
Changpeng Zhao’s statement responds to rumors about Sam Bankman-trading Fried’s company Alameda Research’s financial standing, which surfaced after a leaked balance sheet revealed that the trading company had $5.8 billion in FTT assets as of June 30. (including FTT tokens pledged as collateral).
Alameda had $14.6 billion in assets, $8 billion in liabilities, including $7.4 billion in undisclosed loans, and $14.6 billion in holdings. On Saturday, Caroline Ellison, CEO of Alameda Research, responded to the allegations on Twitter, claiming that Alameda had more than $10 billion in assets that were “not disclosed” on the leaked balance sheet.
According to Ellison, Alameda has various hedges in place and has already paid off the majority of its current debts. Furthermore, Zhao advised purchasing Binance’s outstanding FTT at a fixed price of $22 in order to “minimize the market effect.”
FTX CEO SBF Responds As Binance Dumps FTX Token
Sam Bankman-Fried, CEO of FTX, has addressed Binance’s decision to sell its FTT (FTX) assets. In his conflict with Binance CEO Changpeng “CZ” Zhou, SBF has decided to go the diplomatic path.
Instead of addressing the particular claims, he called for cooperation amongst major industry participants rather than focusing on Alameda Research or Binance dumping FTT.
The cryptocurrency industry is preparing for an all-out fight between FTX and Binance, the two largest cryptocurrency exchanges. The CEOs of both companies, though, are trying to play down the tension between them.
To lessen the potential impact on the market, CZ says he will liquidate FTT gradually. This, he adds, is not meant to harm FTX.
Likewise, SBF says he appreciates CZ’s work for the crypto community. Market leaders, he says, should focus on blockchain development rather than conflict.
3 Coins to Buy the Dip
Dash 2 Trade (D2T)
The second stage of the D2T presale has already sold out, raising $5.16 million in just over two weeks. Dash 2 Trade is a concept created by the hugely popular trading signal company Learn 2 Trade that will be launched in the second half of 2022. The platform’s goal is to provide market-driven insights to investors to help them make informed decisions.
To improve the trading experience, D2T provides trading signals, social analytics, and even market sentiment analysis.
Dash 2 Trade aspires to be the Bloomberg trading terminal for cryptocurrencies, according to the development team. For automating trading processes and optimizing all trading methods, the platform also includes automation and backtesting capabilities.
Dash 2 Trade includes a notification service that alerts investors to all new coin listings on centralized exchanges, providing them with information that was previously only available to elite investors. It’s no surprise that D2T presale numbers have been phenomenal with so much potential.
The digital currency has already raised more than $5.6 million ($5,604,587).
Calvaria, a new cryptocurrency gaming project, is poised to take the industry by storm and become one of the market’s top play-to-earn games. Calvaria developers have discovered two major barriers to widespread Web3 gaming adoption. While investors have recognized the potential of Web3 games, players have not.
Calvaria continues to accelerate its presale, which is already in stage 4 of 10 and close to the $1.5 million mark. With the price of the native RIA token rising significantly at each presale stage, investors are flocking to the rapidly expanding GameFi project.
Tokens cost $0.025 each in stage 4, but by stage 5, the price has risen to $0.03, and by stage 10, tokens cost $0.055.
IMPT’s team is making the world of carbon credits significantly more efficient than ever by putting them on the chain. Until recently, the carbon credit system was incredibly opaque; it was only applicable to businesses, and trading with them was inefficient and archaic. Carbon credits can be traded as NFTs on the blockchain 24 hours a day, seven days a week.
According to Broadridge Financial Solutions, the carbon credit market is likely to surpass $50 billion by 2030, with the ESG industry surpassing $30 trillion.
Over 25,000 firms have already joined the IMPT shopping platform, including industry titans such as Microsoft, River Island, Amazon, and Samsung. With that, the IMPT presale has now raised $12 million and is selling out swiftly.
The IMPT token’s price is increasing with each stage of the presale and is now at $0.023.p
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.
