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TRX Surges Over 600% Following Justin Sun’s Deal With FTX

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TRX Surges Over 600% Following Justin Sun’s Deal With FTX

Tron’s native token TRX has been seeing significant upside on the FTX exchange since the announcement of a potential deal that would allow users to withdraw funds. This deal is one of the only ones that have gone into effect since FTX began experiencing issues and it seems users are already taking advantage of it. However, it is not all rosy as users begin to notice the downside to this.

TRX Price Explodes On FTX

TRX token is already up more than 500% on the FTX crypto exchange over the last week on the FTX exchange. Tron founder Justin Sun had seemingly worked out an agreement with the troubled exchange to allow users to swap their crypto currently stuck on the platform for TRX tokens and then withdraw it.

This would obviously make it possible for users to swap digital assets such as bitcoin, ethereum, etc, to TRX, and then proceed to withdraw it, making it possible for them to withdraw previously stuck funds from FTX. It has naturally become a popular option for FTX users, causing the price of the digital asset to balloon on the exchange.

In just 24 hours following the announcement, TRX’s price was already up significantly. While the token’s price remained relatively low on all other exchanges, it had traded to a high of $0.43 on the FTX exchange. Compared to the $0.05 price mark that is the case across all other exchanges, it is trading at a 600% premium on FTX.

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TRX price spikes on FTX | Source: TRXUSD on TradingView.com

There has been some fluctuation in the price since the token hit this new high on the platform. However, the price still remains high at  $0.43 at the time of writing, with trading volumes already exceeding $630 million in a 24-hour timeframe.

Not A Good Deal

At first, converting digital assets to TRX on the FTX exchange in order to withdraw looked like a good idea, but that only lasted as long as prices on the exchange correlated with the broader crypto market. As the price of TRX inflated on the FTX exchange, the value that users were getting when they swapped their tokens quickly plummeted.

With TRX being 500% above market price on FTX, it means that the exchange’s users would only be getting about 20 cents on the dollar when they swap. This is because after withdrawing TRX from FTX, they would still have to swap the tokens at current market prices. 

To put this in perspective, say someone has $10,000 worth of bitcoin and swapped it to TRX at $0.43 (current prices), they would get around 38,570 TRX. When they withdraw and move to other exchanges for sale, taking the current price on Coinmarketcap of $0.05, they would have only $1,162 after selling. This translates to roughly 12 cents on the dollar.

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Meanwhile, Tron is making bank buying these digital assets for cheap as they are the only ones allowed to transfer TRX into FTX. At the current rate, they will be seeing millions of dollars in profit, presumably giving FTX a healthy cut of the proceeds.

What this shows is that it is the end users that always get screwed over in times like these. Even deals that seem to be “helpful” turns out just to be another way to exploit users who are already in a vulnerable position from the exchange’s collapse. 

Featured image from Medium, chart from TradingView.com

Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet…

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SBF claims to have only thousands of dollars left in bank after FTX’s collapse

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SBF claims to have only thousands of dollars left in bank after FTX’s collapse

  • SBF claims to be down to a hundred thousand dollars, with almost all of his wealth wiped out with FTX’s collapse
  • The former CEO also expressed that there could have been a 50-50 chance for FTX had CZ not expressed concerns

The founder of the infamous crypto exchange, FTX – Sam Bankman-Fried has spilled quite a lot of tea in recent interviews. The man once hailed as the crypto mogul revealed that he has lost almost all of his wealth. Speaking with Axios, SBF claimed that his bank account had $100,000 the last he checked.

This is over 99% fall from his net worth, which was once said to be over $16 billion before the collapse of FTX. Moreover, the former FTX CEO’s wealth even peaked at nearly $26.5 billion at one point. This, however, came crashing down as most of it was tied to FTX. SBF said, “It’s complicated. Basically everything I had was just tied up in the company”.

FTX’s SBF wanted more regulation

Bankman-Fried also weighed on the aspects that could have prevented the fall of one of the largest crypto exchanges in the world. According to the former billionaire, “regulation and proper oversight” would have prevented FTX’s collapse. He added,

I think one thing is… if you looked at the reporting, and CFTC applications, that would have been extremely helpful here on international rigor

SBF further noted that there should have been an additional person handling “conflicts of interest”. This remark was in tangent to the bankruptcy hearing held days ago. During the hearing, it was claimed that the exchange was run like the “personal fiefdom” of Bankman-Fried, with nearly $300 million spent on holiday homes and real estate for senior staff.

SBF makes dark donations to Republicans

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Subsequently, SBF made more explosive revelations in two interviews with Tiffany Fong. Here, he claimed to have made “dark” donations to Republicans. Notably, SBF had already poured millions of dollars in political donations. He even had plans to pour an additional $100 million into the 2024 elections.

Speaking about the events that lead to FTX’s collapse, SBF expressed that it was a combination of multiple events. He said,

“the crash in the spring that took 50% out of asset values, combined with a hyper-correlated crash scenario this month in which simultaneously we saw a 50% decline in relevant asset prices over a two-day period, combined with a complete run on the bank on FTX (…)”

Additionally, SBF stated that there could have been a 50% chance for FTX had Binance’s CEO – Changpeng Zhao – not expressed concerns. He said,

“Things would certainly be a lot more stable and there’s a lot more ability to generate liquidity and there would still be too much margin in the system (…) I don’t know for sure I think like 50-50”

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Bankruptcy

Crypto Exchange Bitfront Shuts Down Amid Industry Challenges

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Crypto Exchange Bitfront Shuts Down Amid Industry Challenges

Cryptocurrency exchange Bitfront has announced its intention to cease operations in the coming months, citing challenges facing the industry. The U.S. trading platform, backed by Japan’s social media giant Line, indicated the decision is unrelated to the collapse of FTX.

Line-Supported Digital Asset Exchange Bitfront Suspends New Sign-ups

Bitfront, a crypto exchange operating in the United States, has suspended new sign-ups and credit card payments while planning to cease operations in a few months’ time. The move comes despite efforts to overcome the current challenges in the “rapidly evolving” crypto industry, the company announced, quoted by Reuters and Bloomberg.

In the statement published on its website, the exchange explained it has “regretfully determined that we need to shut down Bitfront in order to continue growing the Line blockchain ecosystem and Link token economy.” The U.S.-based platform, which launched in 2020, is backed by the Japanese social media firm Line Corp.

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Bitfront also pointed out that the decision to close down is not related to the problems of “certain exchanges that have been accused of misconduct,” an indirect reference to FTX, one of the largest global players in the market before it collapsed and filed for bankruptcy protection on Nov. 11 amid liquidity issues.

Other companies in the space, like Blockfi for example, have been hurt by exposure to FTX. The crypto lender announced on Monday it has petitioned for Chapter 11 bankruptcy protection along with eight of its affiliates. When Blockfi paused withdrawals earlier this month, it specifically cited the “lack of clarity” regarding the state of FTX at the time.

With a 24-hour volume of less than $94 million, only a dozen trading pairs and six coins, according to Coingecko, Bitfront has a small share of a market with a total trading volume of almost $57 billion over the same period, the Bloomberg report noted.

The exchange informed users that new sign-ups and card payments have been suspended on Nov. 28 while deposits in cryptocurrency and U.S. dollars will be halted on Dec. 30. It also urged customers to withdraw all their assets by March 31, 2023, when all withdrawals will be suspended as well.

Tags in this story

Bankruptcy, Bitfront, Challenges, collapse, Crypto, crypto exchange, Cryptocurrencies, Cryptocurrency, Exchange, ftx, Issues, Japan, Line, operations, Services, shutdown, Social Media, suspension, U.S.

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Do you expect other crypto trading platforms to go out of business? Let us know in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Spanish Securities Regulator CNMV Warns About Crypto Investments; Calls For Caution After FTX Downfall

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Spanish Securities Regulator CNMV Warns About Crypto Investments; Calls For Caution After FTX Downfall

The Spanish securities regulator (CNMV) has warned investors against putting funds in crypto-related companies. Montserrat Martinez Parera, vice president of the organization, stated that lack of control is one of the causes of the downfall of the crypto exchange FTX, and that anyone looking at crypto as an investment must be very careful due to the lack of regulation in the area.

Spanish Securities Regulator CNMV Warns About Crypto-Related Investments

The Spanish securities regulator, the CNMV, has given its opinion about the recent downfall of FTX, one of the top three crypto exchanges at a worldwide level. At the inauguration of a public congress on Nov. 25, Montserrat Martinez Parera, vice president of the institution, stated that one of the things that allowed the events involving FTX to develop was a lack of control exerted by some countries.

Martinez Parera also warned investors against embarking on this kind of investment journey, and remarked that they should approach any crypto-related opportunity with extreme caution, given that this ecosystem still lacks regulation and control. She also called for interested parties to wait for MiCA, the cryptocurrency framework being discussed now in Europe, to be approved in order to have more clarity on how crypto asset investments will be regulated.

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Investment Gamification and Advertising

Martinez Parera also criticized the way in which some platforms advertise their financial investment services, trying to make them look as if they were part of a game, especially in the cryptocurrency industry.

About this process, she explained:

We use the term gamification, but they are techniques more typical of video games, deep down there is an addiction component, and they promise you certain earnings in a very short space of time: we know that this is not sustainable and we have seen it in the field of crypto assets.

Martinez Perera’s criticism also tackles the way in which some of these cryptocurrency platforms purposely employ the help of influencers to advertise their services, often offering big yields to their audiences on platforms like Instagram or Twitter. She declared:

It amazes me when sometimes some ‘influencers,’ in a video of less than a minute, tell you how to get rich.

This has been the focus of the organization this year, with influencers such as Andres Iniesta, a national soccer player, being reprimanded by the regulatory body for his promotion of a cryptocurrency exchange to his fans. The CNMV established crypto promotion laws in January that forbid influencers with more than 100,000 followers from running a crypto-related advertisement campaign without informing the group about it ten days prior to its start.

What do you think about the opinion of the CNMV on crypto regulation and the FTX downfall? Tell us in the comments section below.

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Sergio Goschenko

Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late to the game, entering the cryptosphere when the price rise happened during December 2017. Having a computer engineering background, living in Venezuela, and being impacted by the cryptocurrency boom at a social level, he offers a different point of view about crypto success and how it helps the unbanked and underserved.

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Image Credits: Shutterstock, Pixabay, Wiki Commons, T. Schneider / Shutterstock.com

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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