Crypto Updates

FTX collapse is Trust Wallet Token’s gain — Why did TWT price soar 150% in six days?

FTX collapse is Trust Wallet Token's gain — Why did TWT price soar 150% in six days?

Trust Wallet Token (TWT) has surged by nearly 150% in the last six days, bucking the downturn in the cryptocurrency market, whose net capitalization has crashed by almost $100 billion in the same period.

TWT whale accumulation picks up momentum

TWT’s price reached an intraday high of $2.43 on Nov. 15, a day after establishing a record high at nearly $2.75. At its lowest in 2022, the token was changing hands for $0.40, which makes it one of the year’s best-performing assets, with over 225% year-to-date gains.

TWT/USD weekly price chart. Source: TradingView

The Trust Wallet Token’s uptrend picked up momentum in November following the collapse of Sam Bankman-Fried’s FTX, prompting a bank run situation wherein traders withdrew their funds from exchanges en masse.

For instance, the total number of Bitcoin (BTC) in FTX’s wallets dropped to zero in the week ending Nov. 13. Similarly, the exchange’s Ether (ETH) reserves fell from 611,000 to just 2,800 in the same period.

Ethereum balance on FTX. Source: Glassnode

Distrust in centralized exchanges seems to have boosted the appetite for self-custody wallets. Binance CEO Changpeng Zhao’s endorsement of the token’s parent platform, Trust Wallet, has also played a major part in driving up the TWT price. 

Furthermore, the Trust Wallet Token supply rate held by addresses with a balance between 1,000 TWT and 10 million TWT tokens surged during the six-day price uptrend, suggesting whale accumulation. 

Trust Wallet Token supply distribution among wallets holding 1K-10M TWT. Source: Santiment

Meanwhile, the token’s trading volume has soared from 279 million TWT to 593.25 TWT in the same period, showcasing market’s conviction in its uptrend.

Trust Wallet Token daily trading volume (in TWT). Source: Santiment

TWT serves as a utility token for Trust Wallet, wherein traders can buy, sell, and collect NFTs, as well as exchange and stake cryptocurrencies. As a result, TWT typically operates as a centralized exchange token while Trust Wallet enables users to control their own funds.

Thus, it’s likely that Trust Wallet emerged as an off-ramp for traders pulling their funds from cryptocurrency exchanges in the wake of the FTX fiasco, with TWT price rallying in response.

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