FTX to Sell $3.4 Billion Worth of Crypto, Creating Overhang for Altcoins
Matrixport, a crypto services provider, has reported that FTX, a bankrupt crypto exchange, is likely to sell at least $3.4 billion worth of crypto assets to return fiat currency to its users. This continuous selling of assets by FTX and other crypto venture capital (VC) funds is expected to create an overhang for altcoins for the rest of the year.
FTX’s Selling Strategy
- FTX has expressed its intention to sell $200 million worth of crypto assets every week.
- This selling strategy will continue until the end of 2023.
Pressure on Crypto VC Funds
Aside from FTX, crypto venture capital (VC) funds are also under immense pressure to return funds to their investors. This puts them in a position where they must cash out and become crucial sellers of altcoins.
Impact on Altcoins
Solana (SOL), a popular altcoin, has been affected by the potential sales from FTX. Other altcoins, such as ApeCoin (APE) and Axie Infinity’s token (AXS), are also exposed to significant unlocks and releases of tokens, which may lead to further price declines.
ApeCoin (APE) Unlock
- ApeCoin (APE) has an unlock scheduled for Sept. 17, accounting for 11% of outstanding tokens.
- Following the previous unlock of 4.2% APE on Aug. 17, prices dropped by 24%.
- Due to the larger unlock on Sept. 17, prices are expected to continue declining.
Axie Infinity’s Token (AXS) Unlock
- Axie Infinity’s token (AXS) has a sizable unlock planned for Oct. 20, releasing 11% of tokens.
- Since the last unlock event on July 22, AXS has declined by 32%.
- The upcoming unlock is likely to put further downward pressure on AXS prices.