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Why are all cryptos including Bitcoin crashing?
Is this the end? What happened between Binance and FTX?
Yesterday there has been a significant drop in all cryptos and people were worried about this, so I made an emergency video explaining what happened.
You can watch it below.
Video in English audio
Video in Italian audio
I’m going to explain more about what happened exactly.
A few days ago there has been a discussion on Twitter between CZ, the CEO of Binance and SBF, the CEO of FTX.
Binance said they would sell all their FTT (FTX tokens) holdings, worth about $580 million, because they were worried about FTX being insolvent, due to the issues with Alameda.
As part of Binance’s exit from FTX equity last year, Binance received roughly $2.1 billion USD equivalent in cash (BUSD and FTT). Due to recent revelations that have came to light, we have decided to liquidate any remaining FTT on our books. 1/4
— CZ 🔶 Binance (@cz_binance) November 6, 2022
FTX’s CEO accused, in a tweet, a generic competitor (he was obviously referring to Binance) of spreading false information.
@SBF_FTX deleted his tweet that he posted regarding safety of FTX assets, yesterday. Has he been lying about FTX's practices all this way?
— Crypto Slash (@CryptoSlash5) November 9, 2022
He also mentioned that FTX was stable and that withdrawals were available.
However, people panicked and withdraw all the money from FTX, creating a bank run.
At some point, FTX blocked all the withdrawals because of a lack of liquidity.
The FTT token dropped significantly, down almost 80%, so the CEO of FTX asked for help from Binance, which signed a non-binding contract to acquire and save FTX.
This afternoon, FTX asked for our help. There is a significant liquidity crunch. To protect users, we signed a non-binding LOI, intending to fully acquire https://t.co/BGtFlCmLXB and help cover the liquidity crunch. We will be conducting a full DD in the coming days.
— CZ 🔶 Binance (@cz_binance) November 8, 2022
The crypto market recovered shortly after this announcement but dropped again after.
Because of this issue with FTT, the crypto sector was affected, generating a major drop.
The bitcoin price hit a new two-year low.
Luckily I don’t hold the FTT token on my eToro portfolio (I never invested in that token) and also I never deposited money on the FTX exchange, so me and all the investors copying my portfolio have not been affected significantly by this event, however, the whole portfolio dropped about 2% yesterday.
Since I have a large amount of cash in balance, the drawdown was much lower for my portfolio. It could have been worse.
Overall I am not much worried about this event, we are used to this volatility, so I urge my copiers to remain calm.
We need to wait a few days for this to settle. This is actually a good thing as cryptos are now cheaper and oversold, so it’s a good opportunity for buying and holding for the long term.
I am following this, as usual, and will keep you updated on the progress.
I am not making changes to my portfolio right now.
I am keeping my long positions on cryptos open and will wait for the right time to start accumulating again.
This is not the end for cryptos.
Upcoming macro events
The next few days will remain volatile because of important macro events happening.
The mid-term elections in the US are in progress. The results might move the stock market and cryptos.
Tomorrow will be released the U.S. Consumer Price Index (CPI) inflation data for the month of October.
I hope you found this update useful.
If you have any questions contact me.
Follow me on all my social media channels.
Copy my portfolio
If you want to invest in my portfolio, please follow these steps:
1. Create a new account on eToro, via the following link https://www.vincenzostefanini.it/goto/etoro/
2. Go to my eToro profile: https://vincenzostefanini.it/goto/etoro-vincenzost/
3. Click on COPY