Cryptocurrency traders are on high alert as FTX, the beleaguered crypto exchange, moves closer to a $3.4 billion asset liquidation plan.
The liquidation, likely to get approval this Wednesday, will include significant volumes of several popular cryptocurrencies, including Solana ($SOL), Bitcoin ($BTC), and Ethereum ($ETH).
FTX liquidations loom
FTX crypto exchange's proposal to liquidate over $3 billion in recovered crypto assets has caused fresh concerns among investors, who fear that the large-scale sell-off could further destabilize an already struggling cryptocurrency market.
The price of Bitcoin has dipped below the $25,000 level, with the FTX sale likely remaining the main bearish catalyst.
Last month, the bankrupt crypto exchange partnered with Mike Novogratz's Galaxy Digital to sell, stake, and hedge its $3 billion crypto holdings. It aims to return funds to creditors in fiat currency without affecting the asset's value.
Despite FTX's attempts to secure its assets by bridging tokens back to their native blockchains, skepticism remains high among market observers.
In the meantime, the exchange is pursuing legal action against cross-chain service LayerZero Labs with the goal of recovering $21 million in assets.
The restart plan: FTX 2.0
In spite of its precarious position, FTX appears to be eyeing a comeback. A Delaware court filing shows that more than 75 bidders have been approached to gauge interest in backing a restart of the failed crypto trading platform.
The deadline for new bids is set for Sept. 24. This relaunch could be a significant shot in the arm for a crypto market still reeling from FTX's bankruptcy and the ensuing industry-wide fallout.
The unfolding FTX saga comes amid growing investor anxieties and regulatory scrutiny in the rapidly evolving cryptocurrency market.