The effects of FTX’s collapse are being felt throughout the entire cryptocurrency sector, with companies that were allegedly saved by the exchange now being dragged under alongside their former “savior,” Sam Bankman-Fried.
While centralized organizations like lending platforms and custodial exchanges have been hit particularly hard, the state of the entire blockchain ecosystem also appears to be dire given its connections to FTX and Alameda.
The price of SOL has decreased by over 50% since it became apparent that FTX and Alameda were having difficulties, and it has been there for the past few days.
Other network tokens like ETH, MATIC, AVAX, or BNB, which have decreased between 25% and 15% over the same time period, have experienced a much smaller decline.
As the assets of FTX and Alameda are sold off, more sell-pressure is likely to come.
Alameda held $292 million in unlocked SOL, $863 million in locked SOL, and $41 million in SOL collateral, according to the leaked balance sheet that led to the run on FTX.
Damage has occurred on both a structural and financial level. The underlying Solana blockchain reportedly experienced decreased performance as FTX’s collapse caused significant volatility across the crypto markets, impeding liquidations on the DeFi lending protocol Solend.
Damage has occurred on both a structural and financial level. The underlying Solana blockchain reportedly experienced decreased performance as FTX’s collapse caused significant volatility across the cryptocurrency markets, impeding liquidations on DeFi lending protocol Solend.
Many of the project’s tokens were referred to as “Sam coins” in the larger Solana ecosystem as a result of FTX and Alameda’s close support of teams developing on what was once thought to be a potential ETH-killer.
FTX Ventures and Alameda did invest in a staggering 255 crypto funding rounds, according to The Block, but some of Solana’s flagship projects were more reliant on SBF’s empire than other sources.
With soBTC currently valued at just $1,315 on CoinGecko and the disclaimer that “soBTC tokens are wrapped BTC tokens issued by FTX or Alameda,” sollet-wrapped assets de-pegged on the news that they were issued by FTX/Alameda.
As a result of Chapter 11 bankruptcy filings by both of these organizations, BTC tokens are no longer redeemable.
There were concerns that the private keys to Serum, a decentralized exchange based in Solana, had been compromised after the $477 million FTX hack.
The keys were held by FTX rather than the exchange’s DAO, which resulted in the hasty deployment of a fork of the protocol that is now run by “a multi-sig controlled by a team of trusted developers.”
