Bitcoin price rallies to recoup losses since FTX collapse
Cryptocurrency bulls extend one of the most unlikely rallies of the year so far, pushing Bitcoin above $21,000 for a second day. This means that the digital currency has now recouped all of its losses since FTX’s spectacular collapse in November.
The rising tide has lifted most crypto boats, reports the DealBook newsletter. Even some downed tokens — including failed exchange FTX’s in-house token FTT — have rebounded as investors bet the Federal Reserve will slow its pace of interest rate hikes, leading to a broad rally in risky assets. Shares of Coinbase, the publicly traded crypto exchange that laid off workers and cut costs, were acquired at the market open in New York; it has increased by more than 30% over the past week.
But crypto analysts are divided on the sustainability of the rally. Skeptics say the fundamentals for a long-term upside are lacking, making the recent jump a risky bet for investors.
The crypto rally comes as lawyers from Sullivan & Cromwell, the law firm advising on FTX’s multi-billion dollar bankruptcy, revealed that the company’s assets are worth around $5.5 billion, of which 1 $.7 billion in cash and $3.5 billion in crypto assets. That makes this broader rally important to FTX’s creditors – if it lasts.