FTX, which plunged the cryptocurrency market into a deep crisis with its collapse, is now dumping locked tokens on exchanges. Binance and Huobi blocked FTT deposits after $400 million in tokens were illegally released. Tokens were illegally released from FTT’s main distributor address.
FTX illegally released FTTs, what’s going on?
Crypto exchanges Binance and Huobi blocked deposits of FTT’s native tokens, following the deprogramming of nearly $400 million in tokens on Sunday. FTT tokens follow an unlocking program where large batches of tokens are released periodically. But on Sunday, the tokens were released unscheduled without any warning or communication from FTX or interested parties.
According to blockchain data, more than 192 million FTT tokens have been released. They were released from the main deployer. Binance founder Changpeng Zhao made the following statement on Twitter:
Binance has stopped FTT deposits to avoid questionable potential for additional supply affecting the market. We also encourage other exchanges to do the same. FTT contract distributors moved the entire remaining FTT supply worth $400 million, which had to be unlocked in bulk. I’m not quite sure what’s going on.
FTT contract deployers moved all remaining FTT supply worth $400 million, which should be unlocked in batches. Not too sure what's going on.https://t.co/JBPd02xIRk
— CZ 🔶 Binance (@cz_binance) November 13, 2022
A short time later, Huobi Global, supported by Justin Sun, followed this move. In this context, Borsa İstanbul CEO Sun stated that “(We) will closely monitor the situation”.
.@HuobiGlobal has echoed @cz_binance's advice on stopping FTT deposit and will closely monitor the situation 🫡 https://t.co/fpP7bzLnMA
— H.E. Justin Sun🌞🇬🇩🇩🇲🔥 (@justinsuntron) November 13, 2022
Discharge of FTTs came after filing for bankruptcy protection
The cryptocurrency market is experiencing a real tragedy. FTX, one of the largest crypto exchanges, has crashed dramatically. However, events were not limited to this collapse. The background of the collapse and the work of former CEO Sam Bankman-Fried are still under the microscope. cryptocoin.com As you followed, FTX filed for bankruptcy protection under Chapter 11 on Friday. The release of FTT follows a week-long drama featuring FTX in this application. Contagion risks now permeate the wider crypto market.
Meanwhile, the FTT token fell 18% to $1.78 on Sunday. The extraordinary crash of the FTX stock market has led to price drops in eight of the past nine days. Thus, the token fell 93% in November alone. A year ago, FTT’s market cap was around $8 billion. It’s now down to around $350 million, according to CoinGecko. However, new questions about the circulating supply of the token complicate the calculation.
