Solana, XRP At Risk? FTX Bankruptcy Team Unveils Plans for $100M Weekly Sale

The bankruptcy proceedings of FTX, a once-prominent cryptocurrency exchange, are far from over as the bankruptcy team unveils plans for a weekly sale of $100 million worth of cryptocurrencies.

While the team aims to repay creditors, the proposed sale has sparked concerns about potential market impact and the fate of certain tokens held in significant amounts by FTX.

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Solana (SOL) and Other Tokens at Risk

Among the cryptocurrencies that could face downward pressure due to the planned sale, Solana (SOL) is likely to be the most affected. FTX holds approximately 10% of Solana’s total supply, making it vulnerable to potential price dips.

Bitcoin (BTC) and Ethereum (ETH), FTX’s second and third largest holdings, are less likely to experience significant price fluctuations due to their larger circulating supplies.

Other tokens that could be impacted by the sale include Aptos (APT) and XRP. FTX holds approximately $180 million worth of Aptos and $143 million worth of XRP, making them susceptible to potential market shifts.

Historical Precedents and Market Resilience

Despite concerns surrounding FTX’s planned sale, historical precedents suggest that the impact on cryptocurrency prices may be limited.

For instance, FTX’s recent sale of approximately $100 million worth of Solana had little effect on the token’s price, which continued to rally. Similarly, when the U.S. government sold 49,000 BTC seized from the Silk Road, the market experienced minimal disruption.

Likewise, the resilience demonstrated by Solana’s price in the face of FTX’s recent sales suggests that the market may be able to absorb this additional selling pressure.

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Regulatory Challenges and Potential Intervention

The bankruptcy team’s plans may face regulatory hurdles, with bodies such as the Securities and Exchange Commission (SEC) potentially intervening, as seen in previous bankruptcy proceedings involving Voyager Digital. However, the SEC’s intervention in that case proved unsuccessful, leaving room for FTX to proceed with its sale.

Balancing Concerns and Market Dynamics

The prospect of a major firm offloading $100 million worth of cryptocurrency onto the market each week naturally raises concerns about potential price volatility.

However, historical examples, such as FTX’s recent Solana sale and the U.S. government’s sale of seized BTC, indicate that the impact may be less severe than anticipated. The crypto market has shown remarkable resilience in the face of previous large-scale asset sales, and it is possible that it will weather this storm as well.

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