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First Mover Americas: FTX’s Empire Is Crumbling

Facebook iconLinkedin iconTwitter iconCDCROP: Photo of FTX website (Rob Mitchell/CoinDesk)

The once-mighty FTX crypto exchange is collapsing. (Rob Mitchell/CoinDesk)

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This article originally appeared in First Mover, CoinDesk’s daily newsletter putting the latest moves in crypto markets in context. Subscribe to get it in your inbox every day.

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Crypto lender BlockFi has paused withdrawals, saying it cannot conduct business normally in the wake of FTX’s collapse. The move comes even though two days ago Chief Operating Officer Flori Marquez said that BlockFi was “fully operational” and that it was an independent entity. In July, FTX US agreed to provide BlockFi a $400 million line of credit, which also gave the crypto exchange the right to acquire BlockFi. That deal, of course, is now in doubt.

Beleaguered crypto exchange FTX’s Australian arm has called in administrators to examine whether it has enough assets to pay back its customers. FTX Australia’s directors handed the reins to administrators from KordaMentha, an advisory and investment firm, after FTX CEO Sam Bankman-Fried didn’t attend a board meeting, according to a report by Australian Financial Review. All eyes will turn to FTX’s other regional subsidiaries in the days ahead, as the crypto empire’s collapse continues. Bankman-Fried has warned that although FTX US is “100% liquid”, it might halt trading in the coming days and so users should close their positions.

FTX’s subsidiaries have slowly begun to reopen withdrawals. FTX Japan said it had resumed yen withdrawals, and FTX Turkey announced it was working on sending lira balances to its customers. Japan’s regulator had ordered FTX to stop accepting new customers and allow only current customers to close their existing positions and not open new ones. FTX’s regional subsidiaries are able to access local payment rails, and so traders aren’t reliant on the SWIFT network for deposits or withdrawals. Withdrawals on FTX International remained paused.

Chart of the DayCoinDesk - Unknown

(TradingView)

  • The Dollar Index (DXY) has dropped to a three-month low. Markets have been offloading dollar bullish positions since Thursday’s softer-than-expected U.S. inflation release.
  • The weakness in the greenback may provide a tailwind to risky assets, including cryptocurrencies.
  • Some observers, including ING, remain bullish on the dollar.

Trending Posts

  • Bankman-Fried’s Cabal of Roommates in the Bahamas Ran His Crypto Empire – and Dated. Other Employees Have Lots of Questions
  • FTX Collapse Sparks Alarm From US Lawmakers
  • What Bitcoin’s Inflation Hedge Narrative Needs: More Time

Trending1CDCROP: Crypto Exchange FTX Grapples With 'Liquidity Crunch' As Binance Deal Fades (Leon Neal/Getty Images)PolicyFTX CEO John Ray Confirms Late-Night Hack, Says Company Is Working With Law EnforcementNov 12, 20222CDCROP: The HASH Podcast GraphicCoinDesk Podcast NetworkTHE HASH: Headlines: The Fall of FTX- Top Stories of the Week 11-07-22Nov 12, 20223Annotated chart of the 162-asset CoinDesk Market Index (CMI) over the course of the FTX and Alameda saga. (CoinDesk Indices and Research/Sage D. Young)MarketsThe Epic Collapse of Sam Bankman-Fried's FTX Exchange: A Crypto Markets TimelineNov 12, 20224(Staff/Getty Images, modified by CoinDesk)The Breakdown, With NLWOFAC Backtracks (Somewhat) on Tornado Cash SanctionsNov 12, 2022

Source coindesk.com

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