Could FTX's Bahamas arm bankruptcy filing and suspension of Australian license extend crypto winter?
- FTX Digital Markets filed for a Chapter 15 bankruptcy in New York on November 16.
- The Australian Securities and Investments Commission (ASIC) announced the suspension of FTX's license until 2023.
- Bitcoin has possibly hit the market bottom as the total supply in profit slipped to the lowest since March 2020.
FTX's collapse continues to spread further, even engulfing its "separate" arm in the Bahamas region. Those impacted by FTX have already faced the consequences, but the recent market crash will most likely mark the end of bearish sentiment.
FTX Digital Markets go down
FTX's Bahamas arm - FTX Digital Markets, filed for Chapter 15 bankruptcy, in the Southern District of New York, on November 16. This filing allows for the representative, FTX Digital Markets, in this case, to proceed with the case in the US courts.
The announcement came days after FTX.com, along with FTX.US and 130 other firms connected to FTX, as well as Alameda Research, filed for Chapter 11 bankruptcy. But it's not just the Bahamas where FTX has lost ground.
The Australian Securities and Investments Commission (ASIC) suspended FTX's Australian Financial Services (AFS) license on November 16 till May 15, 2023. This 18-month ban by the country's financial regulators arrived just as FTX Australia was provided with restructuring services by KordaMentha, an Australian advisory firm.
This is potentially the last of FTX, as the exchange company has come to an end in all the countries where it has holdings. This could also mean that any further development related to the company will likely not have an adverse effect on the crypto market.
Crypto market winter to end?
Fortunately, since a bankruptcy filing and suspension of the license were expected, their impact will probably not extend the crypto winter, assuming there is no wider contagion. This is also because the consistent decline in crypto prices may have led to excessive losses, resulting in Bitcoin experiencing a market bottom.
Bitcoin price total supply in profit fell to a meager 45.9%, the lowest noted figure since the Covid-19 crash of March 2020. As visible on the chart, Bitcoin is currently in the opportune green zone, which is usually indicative of a market bottom.
Bitcoin supply in profit
Trading at $16,708, if the crypto winter ends, Bitcoin will probably not decline any further. Any recovery is likely to move towards $19,000 – and potentially further.
BTCUSD 1-day chart
However, if prices do drop again, BTC will tag $16,455 again and potentially the psychological support level at $15,000.
Author
Aaryamann Shrivastava
FXStreet
Aaryamann Shrivastava is a Cryptocurrency journalist and market analyst with over 1,000 articles under his name. Graduated with an Honours in Journalism, he has been part of the crypto industry for more than a year now.
