FTT Pump on FTX News Cools Amid Suspicious Whale Activity
TL;DR FTT, the native token of the crypto exchange FTX, surged after news of a potential relaunch in Q2 of 2023. However, whales quickly sold off their tokens, raising speculation about insider trading.
The token has started shedding gains as whales sell.
FTT’s whale trading activity has raised speculation about insider trading.
At its peak, FTX was the second-largest crypto exchange in the world by trading volume, ahead of Coinbase and only behind Binance. But the behemoth collapsed like a house of cards in November after it proved insolvent amid revelations of fraud and gross mismanagement.
The FTX saga may not end there however, as an update from an April 12 bankruptcy hearing revealed that the fallen giant may yet rise again as restructuring officers discuss plans to relaunch the crypto exchange in Q2 of 2023.
The value of FTX’s token, FTT, jumped by over 100% from approximately $1.30 to about $2.80 immediately following the news on April 12. However, at the time of writing, the token has started paring some of its gains and trades at $2.26 per CoinMarketCap data amid potentially suspicious whale trading activity.
FTT/USDT 4-hour Candle Chart. Source: TradingView
FTT Whale Trading Activity Raises Eyebrows
In a series of tweets on April 13, “The Data Nerd,” a prominent on-chain analyst, highlighted that at least three whales cashed in on FTT’s latest price pump. While distribution routinely follows token price pumps, the activity of these whales has sparked speculation of insider trading, as it was revealed that at least two of them purchased the token in the past three weeks.
The first address beginning with 0xdD6, purchased more than 427k FTT for approximately $550K 19 days ago. 0xdD6 deposited all its holdings into Binance when FTT clinched the $2.70 price point for a 100% profit.
A second address, starting with 0x5e4, withdrew 324k FTT from Binance two weeks ago, worth an estimated $400k at a rate of $1.24 per token on average. According to The Data Nerd, 0x5e4 started sending all its FTT to Binance on April 11 and stands to make a 150% profit.
The final address highlighted by the on-chain analyst appears to be a long-term holder who purchased FTT from Binance in February at $1.6 per coin. The wallet starting with 0xff1 sent 100k FTT to Binance following the token’s latest rally for a 60% profit before quickly withdrawing a further 50k FTT.
FTX Lawyer Andrew G. Dietderich has yet to respond to a request for comment.
FTT was FTX’s native token, primarily used to save money on trading fees. The token’s price tumbled after the crypto exchange filed for bankruptcy in November 2022 and had largely been trading below $2 before the hearing.
On the Flipside
FTT has no utility with FTX out of commission, but the news of a potential relaunch gave the token a brief lease of life.
Why You Should Care
FTX’s collapse is considered one of the biggest blowouts in crypto history. FTT made up a large part of the company’s balance sheet when it collapsed, and its former executives have been accused of manipulating the price.
To know more about FTX’s relaunch plans, read this:
FTX Reveals Q2 Relaunch Plans in Roadmap Update: Attorney Dietderich Discusses Assets, Customer Withdrawals, FTX Japan
Interested in Hong Kong’s increasingly pro-crypto stance? Read this:
Hong Kong’s Top Virtual Bank to Service Crypto Exchanges