FTX Receives Court Approval to Liquidate $3.4 Billion in Crypto Assets
FTX has received authorization to offer a substantial $3.4 billion in cryptocurrency assets for sale. This news arrives during market stability, contrary to earlier predictions of a significant market downturn. Michaël van de Poppe, the CEO and Founder of MN Trading has provided valuable insights into this noteworthy development.
The attention-grabbing sum of $3.4 billion mainly consists of assets linked to Solana (SOL), amounting to approximately $1.2 billion. Notably, a significant portion of these SOL assets are currently locked in staking mechanisms, making them unavailable for trading.
FTX gets approval to sell $3.4B in #Crypto assets & CPI data comes in worse than expected
Markets aren't falling down that much, and not much should be happening from it.
The Solana, which corresponds to $1.2 billion of the assets of FTX, is mostly staked and can't be sold.👇… pic.twitter.com/uKG9XefCzy
— Michaël van de Poppe (@CryptoMichNL) September 13, 2023
FTX has received approval to release a maximum of $200 million in assets each week on behalf of their clients, which could help ease their financial obligations. While this may introduce some extra market selling activity, market participants have already considered this decision. The central question now concerns whether we will observe a substantial sell-off of Solana assets.
FTX’s Solana holdings staked
The analyst highlights that FTX’s crypto holdings, valued at $1.2 billion and primarily consisting of Solana, are currently staked, making them unavailable for immediate liquidation.
Van de Poppe further notes that only 7 million SOL tokens are accessible for liquidation on FTX, and a substantial portion of these tokens has been sold in the past week. Given this situation, the analyst anticipates a scenario where we might see a “sell the rumor, buy the news” dynamic.
According to Michaël van de Poppe, the crypto market is unlikely to react significantly to the recent Consumer Price Index (CPI) data and the court’s approval of FTX’s liquidation.
Simultaneously, the financial world was surprised by the Consumer Price Index (CPI) data and crypto developments. The headline CPI has surpassed expectations, reaching 3.7% instead of the expected 3.6%, signaling a slight increase in inflation.
Nevertheless, the core CPI, which excludes the volatile food and energy components, remained steady at 4.3%, in line with expectations. This marginal decrease in the core CPI could potentially impact the likelihood of another interest rate increase by the Federal Reserve.
Despite these developments, the broader financial markets have exhibited remarkable tranquility. The unanticipated CPI figures have not triggered any significant market fluctuations. Instead, attention has shifted to bond yields, which have declined by one percent. This decline in yields be attributed to two primary factors.
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