The latest moves in crypto markets, in context By Jamie Crawley, CoinDesk Reporter Was this newsletter forwarded to you? Sign up here. |
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The roller-coaster continues. Here’s what you need to know in crypto today. |
- Justin Sun puts himself forward as FTX’s savior.
- The latest U.S. CPI report is expected to show inflation ticked down.
- FTX used customer funds to prop up Alameda Research, one report says.
- Bitcoin and ether both continued to fall on Thursday.
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Tron founder Justin Sun has put himself forward as beleaguered crypto exchange FTX’s savior. Sam Bankman-Fried’s firm is once again staring down the barrel after rival exchange Binance said it was walking away from the deal to acquire FTX after it scrutinized FTX’s books. Without volunteering any details, Sun tweeted that he is “putting together a solution with FTX." Tron’s native token TRX momentarily surged 4,000% from 6 cents to $2.50 following the news. The network’s algorithmic stablecoin USDD, however, has lost its dollar peg, recently trading at 98 cents, with Sun speculating Alameda Research, the liquidity-strapped sister company of FTX, might have sold its USDD holdings, kickstarting the stablecoin's deviation. |
With the latest Consumer Price Index report scheduled to be released at 8:30 a.m. ET on Thursday, inflation is expected to tick down. The CPI rose an estimated 8% in October from a year earlier, compared with an 8.2% increase in September, analysts have reported to FactSet. Last month’s CPI release showed a significant growth in bitcoin’s inverse correlation with the U.S. dollar, according to Arcane Research. Therefore, bitcoin investors will be eyeing Thursday’s report keenly, as if they didn’t have enough to worry about. FTX used customer funds to prop up sister firm Alameda Research in May, according to a Reuters report, citing people familiar with the matter. CEO Sam Bankman-Fried transferred at least $4 billion from FTX to support his trading firm Alameda after it suffered a series of losses. Part of this $4 billion was customer deposits though the exact proportion couldn’t be determined. Among Alameda’s losses was a $500 million loan agreed with crypto lender Voyager Digital, which filed for bankruptcy later. Bitcoin (BTC) was recently trading down 6.8% at $16,444, and ether (ETH) was down 2.6% to $1,198 as the wider crypto market continued to sink on the heels of the FTX debacle. |
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Market Insight: Market Volatility Rocks SOL |
Solana’s SOL token has been rocked by recent events, hitting a seven-day implied volatility of an annualized 270% – twice bitcoin’s 135% – according to digital-assets data provider Amberdata. Bearish intent for SOL among traders is exemplified by its seven-day call-put skew of -99%. Traders typically buy bearish puts when they anticipate a price slide, whereas they buy bullish calls when they think a surge is on the cards. SOL may be hit harder than other cryptos like BTC because it is a collateral asset and therefore is likely to get liquidated as FTX and sister trading firm Alameda Research need to raise cash. There have already been rumors that Alameda liquidated its SOL holdings, a factor in the token’s decline of 58% to below $12.50. Read the full story by Omkar Godbole. |
- The chart shows SOL futures basis or the difference between the spot price and the futures price.
- The short-term basis tanked to an annualized 355% early Thursday, hinting at record bearish sentiment.
- "There is panic in the SOL market," Gregoire Magadini, director of derivatives at Amberdata, said.
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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