Last week, notable developments took place in the cryptocurrency market. Particularly, Grayscale’s Bitcoin sales were closely followed by many investors, and as these sales slowed down, an upward momentum began in the crypto market, led by Bitcoin. So, what were the three developments that marked the week and caught the attention of many investors? Let’s examine them together.
FTX Is Selling Crypto Assets
According to a report shared by Bloomberg, the bankrupt FTX is selling its crypto assets, and while preparing to compensate customers whose accounts were frozen when the exchange officially declared bankruptcy in 2022, it is stockpiling cash assets.
The report stated that the company’s four largest subsidiaries nearly doubled their cash holdings from $2.3 billion in October to $4.4 billion by the end of 2023, and according to the Chapter 11 monthly operating reports, the total cash amount including all subsidiaries is likely even higher.
FTX is also suing former CEO Sam Bankman-Fried’s partners and companies that withdrew funds from the exchange before filing for Chapter 11. The bankruptcy claims broker Cherokee Acquisition revealed that claims worth over $1 million traded from 38 cents in October to about 73 cents per dollar last week. FTX, however, said it does not expect to fully reimburse its customers.
Chinese Investors’ Interest in Cryptocurrency Is Rising
According to Reuters, even though cryptocurrency transactions have been banned in China since 2021, many Chinese investors are looking for ways to move their money into crypto assets. An anonymous Hong Kong-based cryptocurrency exchange executive told Reuters that China’s economic downturn has made mainland investments risky, uncertain, and disappointing, leading people to seek to diversify their assets in different regions.
Due to pressures on China’s real estate sector, house prices have fallen in recent years, and the stock market has been declining since 2021. Despite controls on cross-border capital movements, cryptocurrency exchanges like OKX and Binance continue to offer trading services to Chinese investors, who can also open overseas bank accounts to purchase cryptocurrencies.
Blockchain data analytics firm Chainalysis reported an increase in crypto-related activities in China, with the country’s global ranking in peer-to-peer trading volume rising from 144 the previous year to 13 in 2023.
Magic Eden’s Move Towards a Web3 Wallet
According to Crypto News, Solana-based NFT marketplace Magic Eden is preparing to offer a multi-chain wallet designed by developers, a step towards addressing the fragmentation of the NFT market.
The report indicated that the wallet would provide a smoother experience across different blockchain networks, possibly as soon as January 29. While NFT enthusiasts typically use multiple wallets for different blockchain networks, Magic Eden’s multi-chain wallet will enable investors to manage their transactions in Bitcoin, Ethereum, Solana, and Polygon ecosystems from a single point.
