FTT, the token of defunct crypto exchange FTX, surged over 84% overnight following SEC chair Gary Gensler’s comments signaling his openness to a revival of the exchange “within the law.”
FTT is currently trading at $2.29, per CoinGecko.
Gensler’s comments came following reports that three bidders are circling FTX, including former NYSE president Tom Farley’s crypto exchange Bullish.
Speaking to CNBC about the proposed revival of FTX, the SEC chair said, “If Tom or anybody else wanted to be in this field, I would say, ‘Do it within the law.’”
He added that the prospective owner of FTX should “Build the trust of investors in what you’re doing and ensure that you’re doing the proper disclosures—and also that you’re not commingling all these functions, trading against your customers, or using their crypto assets for your own purposes.”
There is no indication that the FTT token will be revived by any of the prospective bidders for FTX.
FTT’s fall
Although FTT has seen a bounce on the prospect of the exchange’s revival, its price has to be seen in context; it’s down over 97% from its all-time high of $84.18 seen in September 2021.
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The token played a pivotal role in the collapse of FTX back in November 2022. After FTX cashed out Binance’s equity stake in July 2021 using FTT tokens, the rival exchange later liquidated its stash, citing “recent revelations that have come to light”—setting in motion a chain reaction that ended with the downfall of FTX.
It also emerged that FTX’s sister trading firm Alameda Research had executed multi-billion dollar loans using the FTT token as collateral as well as commingled funds from FTX users.
FTX founder Sam Bankman-Fried was last week found guilty on seven counts of fraud and conspiracy relating to the collapse of the exchange and faces a maximum sentence of 115 years in jail.
He will be sentenced in March 2024.
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