[Bitcoin Now] Aftershocks of FTX Crisis Cause Decline... Investor Sentiment at 'Extreme Fear'

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] The price of Bitcoin, the leading cryptocurrency, remains weak amid the ongoing fallout from the bankruptcy filing of the global cryptocurrency exchange FTX.

According to the global cryptocurrency market tracking site CoinMarketCap, as of 10:26 AM on the 25th, the price of Bitcoin was recorded at $16,543 (approximately 22.01 million KRW), down 0.32% from the previous day.

Bitcoin prices have been declining due to the continued impact of FTX. Dick Lo, CEO of quant trading and liquidity provider TDX Strategies, explained, "The cryptocurrency market is risk-centered as it reacts to rumors and news about the condition of coin lending firm Genesis." Genesis revealed that $175 million worth of funds are tied up with FTX and has suspended new loans and redemptions. There have also been reports that it is at risk of bankruptcy.

Katie Stockton, founder of cryptocurrency market research firm Fairlead Strategies, said, "There is a negative long-term momentum that keeps the market in an oversold state," adding, "The bearish market phase is still valid."

However, in response to these adverse conditions, Binance, the world's largest exchange, has stepped in to contain the aftershocks. Binance CEO Zhao Changpeng announced the previous day that "a $1 billion industry recovery fund will be established." He added, "If necessary, the fund size could be increased to $2 billion." This fund was created to minimize the widespread impact across the industry following the FTX incident.

Meanwhile, according to cryptocurrency data provider Alternative, the Fear & Greed Index, which measures investor sentiment, remained at 20 points (extreme fear) on the same day as the previous day. Alternative's Fear & Greed Index ranges from 0 points, indicating extreme fear and pessimism about investment, to 100 points, indicating optimism.