Charles Hoskinson – Founder of the blockchain platform Cardano – thinks the turbulence around FTX and its native token – FTT – could be the last adverse event of the ongoing crypto winter.
He finds it normal that the entire digital asset space was negatively affected by the news since Sam Bankman-Fried’s trading venue is among the leading entities in its field, and its crisis causes a “cascade through the cryptocurrency market.”
It’s Always Darkest Before the Dawn
While 2022 has not been kind to the crypto industry, things have even worsened in the past several days. Binance vowed to liquidate 23 million of its FTT tokens which caused the latter’s price crash. In addition, the company and FTX have begun negotiations so Binance can buy out the latter following massive liquidity issues.
Those setbacks triggered a massive collapse of the entire crypto market, whose capitalization plunged below $900 billion. Bitcoin, for one, nosedived to a two-year low of nearly $17,000.
According to Cardano’s Founder Charles Hoskinson, though, this grim situation could be the last negative event before the market starts thriving again:
“I think this might be the bottom, one of the last ones to deal with. It’s going to be hard to predict how bad it will be, and it could certainly potentially be very bad. There are not many more firms that were like FTX or Alameda or like, Three Arrows Capital, and so forth. At least in this cycle, I truly do hope that this is the last cycle of this nature.”
Hoskinson claimed that the eventual purchase of FTX by Binance might not solve the company’s issues. In his view, the best part of the drama is that it could prompt regulators to impose comprehensive rules on the digital asset industry:
“Situations like this, as I mentioned, do tend to invite litigation. They tend to invite regulation, and they tend to invite enormous scrutiny… The purchase of FTX by Binance is no silver bullet. There are still many things that have to happen in order for this to be completely clear for the market.”
Hoskinson’s Initial Prediction
The American entrepreneur said in May that the market entered a new crypto winter shortly after Terra’s collapse. Despite maintaining that the sector was in a phase of “panicked blood in the street,” he advised investors to stay calm as such crises have occurred in the past.
Hoskinson forecasted that the crypto winter could come to an end once “a bottom is found.”
“Then a long climb up the ladder,” he suggested.
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