FTX Token (FTT) plunges another 20% in an hour and causes panic in the markets

FTX Token (FTT), the native crypto-currency of the FTX crypto-currency exchange, has plunged another 20% in the last hour, dropping below the $20 mark. Currently, FTT is trading down 19% at a price of $18.46 with a market cap of $2.4 billion.

The recent sharp drop means that FTT tokens have lost over $500 million in valuation in an hour’s time. Also, the total erosion of the market value of FTX tokens is nearly a billion in the last four days.

Interestingly, cryptologist Colin Wu reported that there has been a massive transfer of FTX tokens (FTT) from the Genesis OTT desk to FTX. He also claims that Binance is not behind the recent price drop. The analyst reported:

FTT suddenly plunged 14% in 1 hour, and SOL fell 14% in 24 hours. 1.9 million FTT ($44 million) was transferred from Genesis OTC Desk to FTX 12 hours ago, but Changpeng Zhao said it was not Binance selling.

Over the weekend, Binance said it had decided to sell its remaining holdings of FTX tokens. The development comes amid recent anomalies surrounding the balance sheets of FTX and its sister company Alameda Research. Binance reportedly transferred half a billion FTX tokens to its platform.

This news followed by Binance’s stock has triggered major skepticism for FTX, with analysts believing this could be another LUNA-like event in the market.

Binance clarifies FTX token episode

Several analysts have said that Binance did this in its competition with FTX, with the sole purpose of taking down its competitor. However, Changpeng Zhao denied these allegations. He also spoke about the transfer of FTX tokens to Binance, saying that it was part of the liquidation process.

However, Binance certainly plans to liquidate the FTT tokens in the coming months. Interestingly, Binance’s CEO also denied the FTX token transfer offer. “I think we’ll stay in the open market“, he said.

On the other hand, FTX CEO Sam Bankman-Fried said its books are clean, regulated and its finances have been audited.