Following the collapse of FTX and the exchange filing bankruptcy on Nov. 11, the trading platform’s exchange token called ftx (FTT) has shed 91.6% in value during the last seven days. While the FTT token’s utility is based entirely on the backing of the now-bankrupt FTX and Alameda Research, the token is still trading for $1.85 per unit. Moreover, FTT’s deployer contract surprisingly unlocked 192 million FTX tokens on Nov. 12, 2022. While a few crypto exchanges have halted FTT deposits, crypto coin aggregation sites like coingecko.com have flagged the number of coins in circulation.
A Suspicious FTT Unlocking Event Puts Crypto Community on High Alert
A touch after 9:00 p.m. (ET), the crypto community noticed that the ftx (FTT) deployer contract moved 192 million new FTT tokens. No one knows why this happened, but it has added 192 million previously locked tokens to the supply of 133,618,094 FTT that was circulating prior to the transfer last night.
Coingecko.com’s website notes that the “FTX token Contract Deployer has transferred out the entirety of supposedly locked FTT tokens into circulation.” In a now-deleted tweet, Binance CEO Changpeng Zhao (CZ) tweeted that Binance has halted FTT deposits. CZ said:
Binance has stopped FTT [deposits], to prevent [the] potential of questionable additional supplies affecting the market. We will monitor the situation.
Similar to the Terra fiasco, the FTX implosion took place in a matter of six days after Alameda Research’s balance sheet was made public, and Binance CEO Changpeng Zhao told the public his exchange would be dumping all of its FTT tokens.
On Nov. 5, 2022, ftx (FTT) was trading for $25 per FTT and by Nov. 8, it was below $5 per coin. FTT was a token launched shortly after FTX was created, and it was privately launched in July 2019 by the FTX and Alameda teams.
Imagine McDonald’s makes its own money, let’s call them clown-bucks, keeps most of it, and sells some to the market.
McDonald’s then uses their remaining clown-bucks as collateral for actual loans.
And then people remember clown-bucks aren’t real.
— Lyn Alden (@LynAldenContact) November 8, 2022
FTX White Paper Claims FTT Is Backed by an ‘All-Star Team’
FTT was made to give owners FTX-based rebates when they traded on the exchange or leveraged FTX OTC. Anyone holding between $1 million to $5 million worth of FTT could get automatically upgraded to a VIP status if they used both services.
Out of the initial 350 million…
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