Decentral Block Post

Crypto.com’s native token Cronos (CRO) is showing restraint on Nov. 14 against mounting sell-pressure building in the wake of the FTX’s dramatic collapse last week. Now, the CRO/USD pair is eyeing a watershed price recovery.

On Nov. 14, CRO’s price wobbled between profits and losses, trading around $0.069 a day after crashing to $0.05, its lowest level since April 2020 — that’s a 60% price decline from November’s peak of around $0.178.

CRO funding rate drops to -3%

The period of CRO’s price decline occurred alongside a sharp drop in the token’s perpetual futures funding rates.

Funding rates are recurring payments made by traders based on the difference between the prices in the futures and the spot market. A positive funding rate means bullish traders (long positions) pay bearish traders (short positions), representing their confidence about a price rally.

Conversely, a negative funding rate means short traders pay long traders to keep their positions open. On Nov. 14, CRO’s funding rates on Huobi and OKX dropped to minus 3%, showing traders are extremely bearish on the token.

Bitcoin (BTC) starts a new week on shaky ground after its lowest weekly close in two years.

The largest cryptocurrency, considerably weakened after last week’s implosion of exchange FTX, continues to grapple with the fallout.

In what is becoming an increasingly erratic market, investors are unsure what will happen next as more firms sound the alarm over solvency and regulators step up investigations in the crypto space.

The mood among the majority is intensely fearful, and even some of the industry’s best-known names warn that it has been set back several years as a result of last week’s events.

At the same time, for Bitcoin, it is business as usual. FTX is not the first such debacle it has weathered, and under the hood, the network remains as robust as ever.

Bitcoin (BTC) investors are withdrawing funds from exchanges at a rate not seen since April 2021 with nearly $3 billion in Bitcoin withdrawn over the past seven days.

New data from on-chain analytics firm Glassnode shows the number of wallets receiving BTC from exchange addresses hit almost 90,000 on Nov. 9.

Exchange users wake up to self-custody

Amid ongoing turmoil over the bankruptcy of major exchange FTX, concerns have heightened among exchange users over security of funds.

Commentators have upped advice to avoid custodial wallets and take control of cryptoassets, and regulators are increasing scrutiny of the crypto industry en masse.

On-chain figures suggest that a large number of hodlers have opted for non-custodial wallets over the past week.

Bitcoin (BTC) will recover from the FTX “black swan event” just like other setbacks, trading team Stockmoney Lizards believes.

In a tweet on Nov. 12, the popular commentator argued that the week’s events were actually nothing new for Bitcoin.

FTX "a real black swan event"

Despite falling 25% in days, BTC/USD is not doomed as a result of the insolvencies impacting FTX, Alameda Research and possibly other major crypto companies.

For Stockmoney Lizards, the unravelling, while sudden, is not hugely different to liquidity crises from earlier in Bitcoin’s history.

“We have indeed seen a real black swan event, the FTX bankruptcy,” it said.

On Nov. 11, NFT Steez, a bi-weekly Twitter Spaces hosted by Alyssa Expósito and Ray Salmond, met with Thomas Webb, the founder of the interoperable avatar game Worldwide Webb, to discuss the integration of interoperability in Web3 and the Metaverse. 

By definition, interoperability is a feature of Web3 whereby a product or system can work seamlessly across platforms with other products or services. Webb defines interoperability simply as "creating a token— a nonfungible token (NFT)" since, at its most basic level, no one can control it besides the creator.

But how does interoperability function presently in Web3, and what is its potential impact?

Executing interoperability the "right" way 

When discussing how interoperable applications can create a profound impact, Webb described the creativity he has seen from NFT communities and brands.

Whether it comes from "creating a product, creating ideas, or creating experiences," Webb believes that enabling the creation of intellectual property (IP) allows users to display their loyalty and in other ways, their achievement.

Up until the start of this week, Bitcoin (BTC) had been demonstrating record-low volatility, and this gave altcoins enough latitude to paint some nice technical setups. 

At the same time, on-chain data and technical analysis were beginning to suggest that BTC was midway through carving out a bottom, and many analysts believed that brighter days lay ahead.

Fast forward to the present, and the volatility spike the market received actually turned out to be a black swan event.

As you already know, FTX is kaput.

Alameda Research is kaput.

The total cryptocurrency market capitalization dropped by 24% between Nov. 8 and Nov. 10, reaching a $770 billion low. However, after the initial panic was subdued and forced future contracts liquidations were no longer pressuring asset prices, a sharp 16% recovery followed.

This week’s dip was not the market's first rodeo below the $850 billion market capitalization level, and a similar pattern emerged in June and July. In both cases, the support displayed strength, but the $770 billion intraday bottom on Nov. 9 was the lowest since December 2020.

The 17.6% weekly drop in total market capitalization was mostly impacted by Bitcoin's (BTC) 18.3% loss and Ether's (ETH) 22.6% negative price move. Still, the price impact was more severe on altcoins, with 8 of the top 80 coins losing 30% or more in the period.

FTX Token (FTT) and Solana (SOL) were severely impacted by liquidations following the insolvency of FTX exchange and Alameda Research.

Aptos (APT) dropped 33% despite denying rumors that Aptos Labs or Aptos Foundation treasuries were held by FTX.

Bitcoin (BTC), Ether (ETH) and cryptocurrency-linked stocks like MicroStrategy are seeing a sharp downturn after news broke that FTX announced filing for Chapter 11 bankruptcy and Sam Bankman-Fried stepped down as CEO. 

Crypto-linked stocks decline

MicroStrategy’s stock, led by the outspoken Bitcoin advocate Michael Saylor, is down 32.57% on Nov. 11 over a five-day period. MicroStrategy holds about 130,000 BTC, and therefore, its stock price is heavily correlated with BTC/USD. Meanwhile, the tech-heavy Nasdaq has gained 0.79%.

Mining stocks also saw losses on Nov. 11, with the Hashrate Index’s Crypto Mining Stock Index showing a 0.14% loss at the time of writing. Top miners’ market performance is much lower, with Marathon down 4.95%, Riot down 5.74% and Hive down 16.08%.

Meanwhile, ETH price saw a 22% decrease this past week despite Ether becoming deflationary for the first time since the Merge. Over 8,000 ETH has been burned in the last seven days, bringing the yearly rate to -0.354%.

In addition to the FTX debacle hindering Ether price, a mass amount of futures liquidations caused the price to hit a fo-month low of $1,070 this week.

Bitcoin (BTC) and cryptocurrency may “take years to recover” from the FTX scandal, one industry analyst warns.

In a Twitter thread on Nov. 11, Filbfilb, co-founder of trading suite Decentrader, said that the Terra LUNA debacle was itself still playing out.

Filbfilb: "I've never seen such a debacle"

The crypto industry is experiencing “a clear case of what goes up must come down,” Filbfilb summarizes.

As the fallout from FTX and Alameda Research only begins to become apparent, many industry businesses and associated tokens have been left reduced to a shadow of their former selves.

Amid bankruptcy concerns from those with exposure to FTX and investigations from regulators, the outlook looks bleak for the industry’s reputation.

The annual supply rate of Ether (ETH) slipped below zero for the first time since Ethereum’s transition to proof-of-stake via the Merge in September. The reason? A spike in on-chain activity amid a massive cryptocurrency market crash. 

Ether turns deflationary for real

As of Nov. 9, more Ether tokens are being burned than created as a part of Ethereum’s fee-burning mechanism. Simply put, the more on-chain transactions, the more ETH transaction fees get burned. 

On a 30-day timeframe, the Ethereum network has been burning ETH at an annual rate of 773,000 tokens against the issuance of 603,000 tokens. In other words, ETH’s supply is going down by 0.14% per year.

Overall, the Ethereum network has burned 2.72 million ETH since the fee-burning mechanism was introduced in August 2021. That amounts to the permanent destruction of nearly 4 ETH per minute.

Ethereum’s transaction fees spiked to their highest levels since May 2022 due to traders rushing to transfer their ETH to and from exchanges amid the dramatic collapse of FTX. 

Bitcoin (BTC) is setting unenviable records this week as hodlers big and small battle some major pain.

Data from on-chain analytics firm Glassnode shows over one-third of the BTC supply being held at a loss by long-term hodlers (LTHs) — a new all-time high.

Long-term holders shoulder record unrealized losses

Profitability has taken a serious hit in recent days, and on-chain data confirms that even the most seasoned investors are suffering.

As BTC/USD crashed to two-year lows of $15,600, investors began to lose big, and at current levels of $17,200, the situation is not much better.

Glassnode shows that LTHs were holding 35.4% of the BTC supply — over 5.9 million coins — at a loss on Nov. 9, decreasing by only 1% on Nov. 10.

Ether (ETH) price shed roughly 33% between Nov. 7 and Nov. 9 after an impressive $260 million in future contracts longs (buyers) were liquidated. Traders using leverage were surprised as the price swing caused the largest impact since Aug. 18 at derivatives exchanges.

The $1,070 price level traded on Nov. 9 was the lowest since July 14, marking a 44% correction in three months. This adverse price move was attributed to the FTX exchange’s insolvency on Nov. 8 after clients' withdrawals were halted.

It is worth highlighting that a 10.3% pump in 1 hour happened on Nov. 8, immediately preceding the sharp correction. The price action mimicked Bitcoin’s (BTC) movements, as the leading cryptocurrency faced a quick jump to $20,700 but later dropped toward $17,000 in a 3-hour window.

The previously vice-leader in futures open interest shared a disguised and toxic relationship with Alameda Research, a hedge fund and trading firm also controlled by Sam Bankman-Fried.

Multiple questions arise from FTX and Alameda Research’s insolvency, directed to regulation and contagion. For example, the United States Commodity Futures Trading Commission (CFTC) commissioner Kristin Johnson said on Nov. 9 that the recent case demonstrates that the sector needs more oversight. Moreover, Paolo Ardoino, chief technology officer of the Tether (USDT) stablecoin, tried to extinguish rumors of exposure to FTX and Alameda Research by posting on Twitter.

Bitcoin (BTC) crashed below $16,000 on Nov. 9, driving the price to its lowest level in two years. The 2-day correction totaled a 27% downtrend and wiped out $352 million worth of leverage long (buy) futures contracts.

To date, Bitcoin price is 65% down for 2022, but it's essential to compare its price action against the world's biggest tech companies. For instance, Meta Platforms (META) is down 70% year-to-date, and Snap Inc. (SNAP) has dropped 80%. Furthermore, CloudFare (NET) lost 71% in 2022, followed by Roblox Corporation (RBLX) and Snapchat (SNAP), both down 70%.

Inflationary pressure and fear of a global recession have driven investors away from riskier assets. This protective movement has caused the U.S. Treasuries' 5-year yield to reach 4.33% earlier in November, its highest level in 15 years. Investors demand a higher premium to hold government debt, signaling a lack of confidence in the Central Bank's ability to curb inflation.

Contagion risks from FTX and Alameda Research's insolvency are the most pressing issues. The trading group managed multiple cryptocurrency project funds and was the second-largest trading exchange for Bitcoin derivatives.

Bulls were overly optimistic and will suffer the consequences

The open interest for the Nov. 11 options expiry is $710 million, but the actual figure will be lower since bulls were ill-prepared for prices below $19,000. These traders were overconfident after Bitcoin sustained above $20,000 for almost two weeks.

Bitcoin (BTC) surged $1,000 in five minutes before the Nov. 10 Wall Street open as United States inflation and jobs data boosted risk assets.

CPI comes in lowest since the start of 2022

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD climbing to daily highs of $17,782 on Bitstamp.

The pair was just hours from a more-than-two-year low below $15,700 at the time, taking its 24-hour low-to-high to 12.8%.

At the time of writing, BTC/USD circled $17,400 with volatility still rampant as U.S. markets opened to digest economic data.

This had come in the form of the Consumer Price Index (CPI) print for October, along with jobless claims.

Bitcoin (BTC) and crypto markets saw fresh volatility on Nov. 10 after stablecoin Tether (USDT) unpegged from the United States dollar.

Tether executive: “No issues” with USDT

Data from Cointelegraph Markets Pro and TradingView showed USDT hitting lows of $0.971 on Bitstamp on the day amid fears that the largest stablecoin by market capitalization may fall further.

Those fears were stoked by evidence of embattled exchange FTX and sister company Alameda Research attempting to short USDT.

Currently in the throws of a crisis reminiscent of the Terra debacle, both firms have fallen foul of the cryptocurrency community and beyond as regulators step up scrutiny of the industry.

The impact has been felt across crypto prices, with BTC/USD reaching more than two-year lows of $15,638 on Bitstamp.

In April 2022, the Tron network launched USDD, a token pegged to the United States dollar as an “over-collateralized stablecoin,” meaning its likelihood of slipping below $1 should be lower due to excessive reserves backing its valuation.

USDD stablecoin slips below $1 peg

But it was not enough to keep USDD’s price anchored to $1 on Nov. 8 when some whales dumped over 11 million USDD tokens to seek exposure in rival stablecoins Tether (USDT) and USD Coin (USDC). A day later, USDD’s price fell to as low as $0.96, followed by a modest recovery to $0.98 on Nov. 10. 

The selling pressure was visible more broadly in the USDD liquidity pool on Curve’s decentralized finance protocol. As of Nov. 10, the pool was heavily imbalanced, holding nearly 82.50% in USDD and the rest in USDT, USDC and Dai (DAI) stablecoins. 

Tron founder Justin Sun speculates that Alameda Research, a crypto hedge fund headed by FTX’s Sam Bankman-Fried, could be the whale dumping its USDD holdings to avoid insolvency. Alameda’s balance sheet reportedly was 50% FTX Token (FTT), FTX’s native token that has recently fallen more than 90%.

Miscalculated collateral reserves

USDD is issued by Tron DAO Reserve (TDR), which also serves as the custodian of its collateral. TDR is primarily responsible for selling the collateral to maintain USDD’s peg in the event of a sell-side shock.

Bitcoin (BTC) miners could form the next BTC price “trigger,” research warns as withdrawals intensify.

In a Quicktake post for on-chain analytics platform CryptoQuant on Nov. 10, contributor MAC.D suggested that miners could soon face “bankruptcy.”

Research: Network conditions “will strangle” miners

After BTC/USD fell 20% in a matter of days, miners began operating at a higher cost than the block subsidy and transaction fees they earned.

The result is mining rigs being idled and miners selling BTC to cover expenses.

“BTC security is at an all-time high, but its mining volume is gradually decreasing. This will strangle the miners,” MAC.D explained.

Investor sentiment in the crypto market is floundering after Binance decided to nix its agreement with FTX to purchase the distressed cryptocurrency exchange. The events have sent Bitcoin to a new yearly low, while other altcoins have also taken a sharp downturn. 

Data from Cointelegraph shows Bitcoin (BTC) declining to $15,698 amid the chaos caused by FTX’s potential insolvency and the failure of the Binance deal. Analysts are turning to technical charts to try and find the next price path.

Analyst expects downside continuation with brief support at $12K

Independent market analyst, CanteringClark said that BTC price could possibly find a short-term bounce at $15,000. Citing an assortment of indicators, the analysts suggested that Bitcoin could eventually settle around the $12,000 level.

Will Bitcoin price drop below key multi-year moving averages?

Analyst Caleb Franzen explained that the estimated moving average (EMA) is an indicator utilized to gauge price over a certain period of time. According to Franzen, if Bitcoin price continues to fall, it would be the first time in its history that the 52 week and 104 week EMA's crossed below the 156 week EMA.

Read more: Bitcoin sinks to new yearly low at $16.8K as FTX insolvency fears turn into contagion

Bitcoin (BTC) fell below $17,000 on Nov. 9 as rumors spread over crypto exchange Binance exiting a deal to buy embattled competitor FTX.

Binance CEO: “Do not trade FTT”

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD hitting $16,936 on Bitstamp before rebounding.

The latest dive hit an already shaky market, which had reacted badly to news that FTX asked Binance for financial assistance.

In a note to staff shared on Twitter, Binance CEO Changpeng “CZ” Zhao told them to refrain from trading FTX’s in-house FTX Token (FTT).

“I want to remind everyone: DO NOT trade FTT tokens. If you have a bag, you have a bag,” it read.