Crypto Market Daily Highlights – SOL Tumbles Out of Top Ten

Key Insights:

• Solana (SOL) tumbled by 40% to leave the crypto top ten, with BNB and XRP seeing heavy losses.
• Binance walked away from the FTX deal, citing the mishandling of customer funds and regulatory scrutiny as the reasons to withdraw.
• The crypto market cap slumped by $122.7 billion to end the day at $753.9 billion.

It was a bearish Wednesday session for the crypto top ten. SOL tumbled by 38.6% to leave the top ten, with BNB and XRP leading the crypto top ten losses. BTC saw red for a fourth consecutive session. Notably, BTC tumbled to sub-$16,000 for the first time since November 2020.

The US economic calendar and the mid-term elections took a back seat on Wednesday. The market focus remained on the FTX and Binance deal following news of Binance signing a Letter of Intent (LOI) on Tuesday.

However, following company due diligence, Binance announced it would not proceed with the acquisition.

In withdrawing from the deal, Binance stated,

“As a result of corporate due diligence, as well as the latest news reports regarding the mishandling of customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com.”

According to Bloomberg, FTX CEO Sam Bankman-Fried told investors that there is a shortfall of up to $8 billion and that without a cash injection, the company would need to file for bankruptcy.

Binance CEO Changpeng Zhao (CZ) summarized the lay of the land, saying,

“FTX going down is not good for anyone in the industry. DO not view it as a “win for us”. User confidence is severely shaken. Regulators will scrutinize exchanges even more. Licenses around the globe will be harder to get. And people now think we are the biggest and will attack us more. We must significantly increase our transparency, proof-of-reserves, insurance funds, etc. A lot more to come in this area. We have a lot of tough work ahead of us. Not to mention prices swinging wildly.”

With FTX facing bankruptcy, contagion risk and increased regulatory scrutiny will be focal points over the near term.

SEC Chairman Gary Gensler commented on the events of the last 48 hours, saying,

“Investors get hurt when we don’t rely upon the time-tested public policy guardrails.”

The crypto market events of the last 48 hours led to a further decoupling from the NASDAQ Composite Index. While the NASDAQ fell by 2.48%, the crypto market slumped by 14% on Wednesday.

For the day ahead, the crypto market will remain in the hands of the news wires. Expect any domino effect to hit the crypto market for a third consecutive day. However, investors may hold onto the hope of a last-minute deal to save FTX from bankruptcy.

Crypto Market Sees Largest Single-Day Fall Since June 13

It was a bearish Wednesday session. The crypto market rose to an early morning high of $883.4 billion before sliding to a low of $736.4 billion.

On the day, the crypto market slumped by $122.7 billion to end the day at $753.9 billion. The day’s losses were the most marked since June 13, when investors responded to Celsius freezing withdrawals. On June 13, the crypto market tumbled by $130.6 billion.

The Crypto Market Movers and Shakers from the Top Ten and Beyond

It was a bearish Wednesday session for the crypto top ten.

SOL tumbled out of the crypto top ten after a 38.6% slump, with polygon (MATIC) taking its place. MATIC fell by 22.04%.

BNB and XRP led the rest of the top ten into the red, with losses of 18.61% and 18.14%, respectively.

However, things were no better for the rest.

ADA (-14.78%), BTC (-14.20%), DOGE (-16.35%), and ETH (-17.956%) all saw heavy losses.

From the CoinMarketCap top 100, it was a bearish session.

FTX token (FTT) responded to Binance pulling the plug, tumbling by 58.74%, with SOL close behind. Lido DAO (LDO) was among the worst performers, sliding by 28.80%.

No cryptos ended the day in positive territory on Wednesday.

24-Hour Crypto Liquidations Ease Back Despite Binance Withdrawal

Over 24 hours, total liquidations eased back, despite another crypto meltdown. At the time of writing, 24-hour liquidations stood at $585.05 million, down from $854.42 million on Wednesday morning.

Liquidated traders over the last 24 hours also eased back but remained elevated. At the time of writing, liquidated traders stood at 329,379 versus 403,858 on Wednesday morning. Liquidations were down over one and four hours and over 12 hours.

According to Coinglass, 12-hour liquidations fell from $544.12 million to $391.49 million, with four-hour liquidations down from $482.13 million to $186.75 million. One-hour liquidations slid from $280.40 million to $23.65 million, reflecting chaotic market conditions.

The chart below shows market conditions throughout the session.