FTX Stablecoin Reserve Tumbles As Community Panic Over Bankruptcy Claims

The Sam Bankman-Fried-led FTX seems to be in a tough patch as its stablecoin holders fear the worst following a significant decline in the exchange’s reserve over the past 24 hours.
According to a report by the blockchain analytic firm, CryptoQuant, data suggests that the current FTX reserve is $107 million. It is significant progress, given that it had slipped by 93% in the past two weeks to reach $51 million.
Furthermore, another analytic data platform, Nansen, revealed that FTX had the highest stablecoin outflows among major exchanges over the past week. Accordingly, this pushed the FTX reserve down to $300 million, with a balance of $261 million at the time of writing.
Meanwhile, FTX’s increased reserve is fueled by Alameda Research’s fund movement, which withdrew many stablecoins from Circle and other exchanges and dumped them in FTX. Like FTX, Alameda is also owned by Sam Bankman-Fried.
Data from Lookonchain shows that on November 3, Alameda moved $487 million worth of USDC from Circle and transferred it to the FTX exchange.
In addition, Alameda Research also withdrew more than $197 million USDC from Circle following the remarks from its CEO, Caroline Ellison. The CEO is reported to have said that the firm is ready to purchase Binance’s FTT at $22 per share.
As revealed by CryptoQuant, Ethereum’s outflow from FTX is at an all-time high. This put its current reserve on the FTX platform at 108,246.43 ETH, the lowest in two years.
Crypto Influencers Call For Massive Withdrawals From FTX
Following the recent slump in FTX’s stablecoin reserve, several crypto influencers have begun urging their followers to withdraw funds from the troubled exchange. One of their most influential members is the founder of the crypto banter group, Ran Neuner.
The famous influencer posted on his Twitter account, urging his supporters to take the opportunity to move their assets. According to him, he has nothing against FTX, but there is no “upside” to keeping funds in troubled exchanges.
As expected, several traders heeded the call by influencers to withdraw their funds from the FTX platform. However, the traders added that they face some challenges while moving their assets. Interestingly, other traders noted that the exchange charged them higher transaction fees to process their withdrawals.
According to Ben Armstrong, one of the crypto influencers, “people should consider closing their FTX accounts, not because they have become illiquid.” Instead, he believes that FTX is out to harm traders as the exchange aims to recover from the recent setback.
Meanwhile, amid the panic, the CEO of FTX, Sam Bankman-Fried, insists that the exchange is doing well. In his Twitter post, Bankman-Fried debunks the news that the exchange is in crisis, adding that all is well with FTX.
The billionaire added that FTX has already processed billions of dollars worth of deposits and withdrawals on its platform. He noted that the exchange is open to welcome back users who withdrew their funds in panic when the dust settles.
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