Bitcoin price surged to nearly $26,000 on Sep 12, reversing Monday’s decline to below $25,000 – the lowest level in the past 3 months. The second largest cryptocurrency by market cap Ether (ETH), at the same time, fell 3.2% to $1,560. ETH is not increasing significantly now, trading at only $1,588 on CoinMarketCap.
The entire crypto market plummeted on the first day of the week, due to concerns about sell-off pressure from FTX exchange. Although Bitcoin’s recovery is impressive, it remains limited by the lack of an immediate bullish catalyst, analysts say. Optimism about the Bitcoin ETF spot has faded as observers turn their attention to FTX, which prepares to liquidate its holding altcoins. The bearish bias remains robust while the 50-day Exponential Moving Average (EMA) is positioned around $25,500, and with Bitcoin consistently trading below the 50 EMA.
As reported by CoinDesk, Singapore-based crypto services provider Matrixport noted that altcoins could be seriously affected as FTX might start selling tokens as early as this week. SOL dropped over 8%; TON also saw similar drops; and Ripple’s XRP suffered a 5% loss.
Among underperforming altcoins, SOL is facing the most significant pressure as FTX holds 1.16 billion worth of that tokens, nearly 16% of its outstanding supply. This bankrupt exchange also holds $560 million in BTC and hundreds of millions of dollars in lesser known illiquid micro-cap tokens. The firm has tapped digital asset investment firm Galaxy to support the sale.
Matrixport added that FTX’s crypto sales could even negatively affect altcoin prices for the rest of the year, signaling that altcoin winter is coming.
Furthermore, FTX is not the only major seller in the crypto market. Venture crypto funds are also under pressure to repay their investors. Those funds may sell a large amount of altcoins, making altcoins significantly drop.