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The bankrupt crypto trading platform FTX Derivatives Exchange is in the headlines today as it continues its bankruptcy proceedings. Based on recent moves, on-chain data shows the exchange redeemed some of its Solana (SOL) locked in POS staking.
FTX and Solana: Genesis
Data from Solscan shows that wallets connected with FTX or Alameda Research redeemed 177,693 SOL worth approximately $24 million. While the exact reasons for this redemption remain unclear, speculation is limited.
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First, the FTX exchange needs as many operational funds as possible to finance its ongoing bankruptcy proceedings. The cost of attorneys, payment of staff and related entities make it an ideal move for the trading platform.
In its prime, FTX exchange was a major supporter of Solana. Through Alameda Research’s investment, the trading platform received a humongous allocation of SOL, making it one of the largest holders of the coin.
When FTX went bankrupt, Solana was pressured by the firm’s exposure. This contributed to the massive slump in SOL’s price post-FTX implosion. While the coin’s price and business have rebounded to its pre-FTX bankruptcy levels, FTX’s influence remains visible.
Following the latest redemption, the FTX exchange still commands 7.057 million SOL worth $954 million in staking.
What comes next?
FTX is in the latter stages of its bankruptcy. The firm is notably consolidating funds to repay its creditors. Based on this, it is highly probable that the firm will redeem all the $954 million in staked SOL in the coming months.
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As to what the future might hold for FTX, the firm aims to reboot the exchange to chart a path toward a fresh start. While nothing much has been said regarding this thus far, future SOL liquidations might unsettle the digital currency’s price remarkably.
As of writing time, Solana was changing hands for $134.91, up by 2.36% in 24 hours. With a 9.6% boost in trading volume to $2,018,446,819, it becomes evident that the FTX redemption did not spark sell-off fears for SOL, as is customary.