Chain overreaction – Revelations about the amount of FTX Token (FTT) in Alameda Research’s balance sheet have ignited a systemic backdrop that, these days, is only looking to ignite. The Binance CEO Statements in this regard, push the token a little further into the red. The misfortune of some makes the happiness of others?
FTT: are short positions taking over?
After Changpeng Zhao announced that the crypto exchange would liquidate its holdings of FTT, traders did not wait long to hedge against a possible drop in the token. CZ had however promised that the operation would extend over several months, to minimize its impact on the markets.
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According to data from CoinGlass, open interest on FTT futures fell from $87.56 million to $203 million since the start of Asian hours. He has then more than doubled, and hit a 12-month high. The funding rate meanwhile fell at an annualized rate of -36%, according to data from Matrixport Technologies.
This explosion of open interest combined with the negative financing rate are strong signals of a probable short position on the FTT by traders. The token is currently recording a loss of around 4.40% on a daily basis.
Despite crisis, Changpeng Zhao and Sam Bankman-Fried expressed restraint and mutual respect in their Twitter exchanges regarding this strategic shift for the world’s #1 exchange. In fact, these declarations of intent did not prevent the CEO of Binance from firing red bullets at its competitor FTX, and seizing the opportunity to plunge the FTT token.
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