In the wake of FTX’s bankruptcy and its creator running off with everyone’s coins, Bitcoin experienced a massive drop in price. It was down 18% for the month before steadying the ship and making a 2.5% price jump. It’s still less than the hard-fought $20,000 level from the past months. It’s another disappointment in over a year of failures, but if you look at the silver lining, now’s the best time to buy.
Unlike what many are thinking, crypto is not dead. This won’t spell doom for Bitcoin and altcoins. Crypto billionaires are making things far more difficult than expected, but Bitcoin will prevail. Right now is the perfect opportunity to invest in Bitcoin, especially now when the market has slightly turned green.
FTX’s Demise
The demise of one of the biggest cryptocurrency exchanges in the world, FTX, has been all over global news for the past week. It has plunged the crypto market in turmoil and added more fuel to the fire. Created by one-time billionaire Sam Bankman-Fried, it turned out a big fraud. Thanks to Binance’s research skills, it was revealed that a large portion of FTX’s native token—FTT—was invested into the exchange’s partner firm Alameda Research. Which means that Bankman-Fried was pumping value artificially, resulting in accusations of fraud against FTX.
The token’s value quickly collapsed and FTX went in bankruptcy following a liquidity crisis. Binance was quick to act selling its holdings of the token. It then sent a letter of intent to acquire FTX with due diligence, although it was withdrawn the next day. FTX filed for bankruptcy on November 11, with Bankman-Fried resigning as CEO. He admitted his mistakes in a lengthy twitter thread, though later he posted some very cryptic messages which haven’t been decoded yet.
FTX’s demise is the reason why the crypto market fell apart. This will have implications for months to come unless a bull market materializes out of the blue. The good news is that the market has steadied, and now may be the perfect time to jump in.
Bitcoin Price Prediction
Right now, Bitcoin is trading at just over $16,000, but has seen a slight increase from the $15,000 lows. It’s trying to reclaim the $17,000 level, consolidating in a new range that will further show us what happens next. Resistance according to the 50-day moving average is around $17,350. A cross above it may take the price over $18,000.
Right now, what needs to happen is for the $16,000-$17,000 trading range to break. If Bitcoin reclaims the higher levels, great. If it doesn’t, we’ll wait for another week. With FTX gone, time will pass before the market stabilizes. In an unstable global economy and the war in Ukraine escalating, nothing is clear.
But, we’ve seen crisis before and crypto has always persevered. That will be the case right now too. A slight turn of the wind’s direction can have a butterfly effect on the prices, pushing Bitcoin into the green like we’re all hoping for.