As speculators drove the values of major cryptocurrencies lower on Tuesday morning trading, Bitcoin hit a more than two-year low due to worries that the collapse of the FTX.com cryptocurrency exchange on November 11 may threaten to ruin other firms linked to the platform.
According to CoinMarketCap, the top cryptocurrency in the world dropped as low as $15,599 and was trading at $15,776, a loss of 3.4% in a day. In September 2020, or prior to the bull run of 2021 when it reached a high of US$68,000, bitcoin was last trading at these values. Currently, it has dropped 77% from that peak.
The financial health of businesses having exposure to the now-defunct FTX exchange, which includes the cryptocurrency investment bank Genesis Global Trading, controlled by the venture capital firm Digital Currency Group, is the subject of much of the cryptocurrency market’s interest.
According to its quarterly report through September, it announced a halt to withdrawals last week at its brokerage unit Genesis Global Capital, which now has around US$2.8 billion in deposits.
Genesis Global Trading, based in New York, stated that its decision was made in response to “abnormal withdrawal requests” that exceeded Genesis Capital’s available liquidity. This sparked worries that funding problems brought on by the FTX collapse are affecting other companies.