FTX Collapse and Bitcoin's Record Dormancy Amid Market Uncertainty

By: Isha Das

Bitcoin's Unmoved Supply Observes Substantial Surge

Almost 70% of the existing Bitcoin supply has not moved for a year, a notable increase attributed to the buyer surge that came in the aftermath of FTX's collapse last November, when the Bitcoin value plummeted to $15,500. A substantial 14-day shift in this passive supply is one of the highest ever seen for Bitcoin, with such drastic changes rarely observed in the history of the digital currency.

FTX's Produce Notable Ripple Effects in The Crypto Market

FTX's insolvency in 2022 and Binance's settlement of $4.3 billion with U.S. authorities have offered a robust case for the provisions of the European Union's Markets in Crypto-Assets (MiCA) legislation, according to a senior European Commission official. Calling the FTX debacle and recent issues with Binance unfortunate confirmations, policy officer Ivan Keller said the ensuing push towards robust MiCA regulations could help mitigate risks and provide regulatory supervision to eliminate potential threats in the future.

Binance Settlement Encourages FTT Token Rally

In related news, the native FTT token of the now-defunct FTX showed a rally of 55% within 48 hours. This happened despite FTX, in partnership with Alameda Research, transferred assets totaling $474 million during the same period that would usually have a depreciating effect on the FTT price. This move shows FTX's effort to manage its financial obligations and possibly facilitate a new phase known as FTX 2.0, scheduled to restart the exchange by Q2 2024.