Bitcoin will shrug off the FTX ‘black swan’ just like Mt. Gox — analysis
Bitcoin (BTC) will recover from the FTX “black swan event” just like other setbacks, believes trading team Stockmoney Lizards.
In a chirping On November 12, the popular commentator claimed that the week’s events were actually nothing new for Bitcoin.
FTX “a true black swan event”
Despite falling 25% in days, BTC/USD is not doomed as a result of the insolvencies affecting FTX, Alameda Research and possibly other major crypto companies.
For the Stockmoney Lizards, the resolution, while sudden, is not very different from liquidity crises from earlier in Bitcoin’s history.
“We have actually seen a true black swan event, the FTX bankruptcy,” it said.
“The history of BTC is lined with such events and the market will recover from it as it did in the past.”
An accompanying chart flagged similar “black swan” moments from the past, stretching back to Mt. Gox hack in 2013.
Two other notable events were the Bitfinex hack in 2016 and the March 2020 COVID-19 crash.
As Cointelegraph reported, ex-FTX CEO Zane Tackett even offered to copy Bitfinex’s liquidity recovery plan from the time of the $70 million loss by creating a token. FTX then filed for Chapter 11 bankruptcy in the United States.
Reactions have included candid assessments of the crypto industry, with Filbfilb, co-founder of trading suite Decentrader, predicting a multi-year recovery process.
Changpeng Zhao, CEO of Binance, which at one point planned to buy FTX, has warned that the industry has been “set back a few years”.
Exchange BT reserves near five-year low
Meanwhile, the loss of user confidence is already showing itself in falling currency balances.
Related: Hodlers in Losses Sitting on 50% of BTC Supply After $5.7K Bitcoin Price Drop
According to data from on-chain analytics platform CryptoQuant, the BTC balance of major exchanges is now at its lowest since February 2018.
The platforms tracked by CryptoQuant ended November 9 and 10 down 35,000 and 26,000 BTC, respectively. Both days were multi-month records, but still did not surpass the single-day figures of June 17 – 67,600 BTC.
Exchange performance continues to be monitored by industry analysts, among them CryptoQuant Contributor, Maartunn.
More generally, voices have encouraged social media users to withdraw money from custodial wallets.
“Bitcoin exchanges are run by people who learned fiat finance,” Saifedean Ammous, author of the popular book, “The Bitcoin Standard,” wrote in part of a Twitter post.
“Gambling with depositors’ money is normal and healthy for them, because the central bank in the fiat system destroys the currency to save them every time it goes wrong.”
The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trade involves risk, you should do your own research when making a decision.
