FTX Aims to Sell $3.4 Billion in Bitcoin, Ether, SOL

FTX Aims to Sell $3.4 Billion in Bitcoin, Ether, SOL

Cryptocurrency prices decline amid worries that FTX may sell $3.4 billion in assets to repay creditors, with Bitcoin, Ethereum, and other major tokens experiencing losses.

Key Points

  • Cryptocurrencies drop as FTX’s potential sale of $3.4 billion in assets to repay creditors raises concerns.
  • Delaware Bankruptcy Court officers to decide on FTX’s request on September 13, with plans to enlist Galaxy Digital for sales.
  • Bitcoin falls 2.9%, Ethereum down 4.6%, and XRP drops 5.7% amid market worries about FTX’s approval.
  • FTX’s holdings include $1.2 billion in SOL, potentially causing a price drop if liquidated, leading to concerns about market flooding.

Cryptocurrencies experienced a significant decline on Monday amid concerns over potential selling pressure from digital asset exchange FTX. Investors are wary that FTX may receive regulatory approval to sell its $3.4 billion worth of crypto assets in order to repay creditors and reduce volatility risks.

FTX Crypto Dump

A decision on FTX’s request to sell $3.4 billion in crypto assets is set to be made by Delaware Bankruptcy Court officers on September 13. If approved, FTX plans to enlist the advisory services of Mike Novogratz’s Galaxy Digital for the sales. The proposed plan allows for a maximum weekly liquidation of $100 million in cryptocurrencies, with the possibility of raising the limit to $200 million for individual tokens.

In addition to $1.1 billion in cash held when FTX filed for Chapter 11 bankruptcy in November 2022, the company has secured approximately $2.6 billion in cash. FTX also holds $3.4 billion in cryptocurrencies and owns 38 Bahamian properties valued at an estimated $222 million.

Cryptocurrencies Poised For Major FTX-Fuelled Pullback?

Bitcoin experienced a 2.9% loss on September 11, briefly dropping below the $25,000 level as market participants considered the possibility of FTX’s approval. Ethereum, the second-largest cryptocurrency by market cap, declined by 4.6% in the past 24 hours. Ripple’s XRP was hit hardest, falling by 5.7% during the sell-off. Solana (SOL) also lost 3.8% of its value and traded at $17.49 at the time of publication. FTX holds nearly $1.2 billion worth of SOL, which accounts for nearly 16% of its outstanding supply.

FTX’s cryptocurrency holdings include $560 million in BTC and $192 million in ether. If approved, the sell-off could put downward pressure on prices as the newly liquidated cryptocurrency enters the market. Concerns have been raised within the Crypto Twitter community about the potential for the market to be flooded with billions of dollars once the liquidators take action.

“SOL is going to dump hard after FTX sells its bag, going to reach $14 soon,” expressed one user on Twitter.