Bitcoin and Ether prices fell in Thursday morning trading along with all other top 10 tokens by market capitalization, excluding stablecoins. The ongoing unfolding of who is exposed to the collapse of the FTX cryptocurrency exchange is unsettling investors, while layoffs in the technology industry point to a difficult economy ahead.
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- Bitcoin fell 1.3% to US$16,666 in the 24 hours to 8 a.m. in Hong Kong, while Ether lost 2.9% to US$1,215, according to CoinMarketCap.
- Bitcoin withdrawals from centralized crypto exchanges reached historic highs this week as the collapse of FTX.com prompted investors to turn to self-custody options. Bitcoin exchange outflows rose to 742,401 between Nov. 9 and Nov. 15, with the largest withdrawal of 168,287 coins on Nov. 9, according to CryptoQuant.
- “The drama around FTX upset what was otherwise an emerging positive setup for crypto as the significant deleveraging in May and June 2022 had left few if any large marginal sellers in this space,” analysts David Duong and Brian Cubellis of U.S.-based crypto exchange Coinbase wrote in a monthly outlook report. “But the recent market turbulence and absence of large buyers has left the asset class vulnerable, potentially extending an already long crypto winter,” according to the report, which said that the crypto slump may extend to the end of 2023.
- Polygon saw the largest losses in CoinMarketCap’s list, falling 4.3% to US$0.90, though it was still trading up 10.6% over the past seven days as one of the strongest performers amid the market volatility over the past two weeks.
- XRP fell 3.3% to US$0.37, though is still up 13% over the past week as U.S.-based cryptocurrency exchange Coinbase submitted an amicus brief on Monday to support Ripple Labs Inc. — the company that uses XRP to power its payment system — in its lawsuit with the U.S. Securities and Exchange Commission.
- Tracey Plowman, chief operating officer of Bamboo 61 Pty Ltd., an Australian company offering micro-investments in cryptocurrency, told Forkast that the industry was still coming to terms with the fallout and uncertainty from FTX. “Regulation certainty is what the industry seeks,” she said via email. “Regulation needs to support innovation and not stifle it whilst giving certainty to industry participants that they are building business based on regulations that will not change.”
- U.S. equities ended the day lower on Wednesday. The Dow Jones Industrial Average fell 0.1%, the S&P 500 Index dropped 0.8% and the tech-dominated Nasdaq Composite Index slumped 1.5%.
- The losses come as Amazon.com Inc. became the latest tech giant to announce mass layoffs on Wednesday, as the Wall Street Journal reported the company could cut as many as 10,000 of its roughly 1.54 million employees. Amazon stock dropped 1.8% on Wednesday.
- This brings the total of staff cuts in the once booming tech sector to 30,000 in recent weeks across just three companies, Amazon, Meta Platforms Inc., and Twitter Inc., which was recently acquired by the world’s richest man, Elon Musk.
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