According to the AP, JPMorgan strategist Nikolaos Panigirtzoglou said the crypto market will face weeks of average loss due to the FTX crisis, which could cause the bitcoin price to drop to around $13,000.

In a report, he noted that a range of margin calls could be on the way, with the FTX exchange and its sister trading company Alameda and interactions with the rest of the ecosystem. electronic currency.

“The near collapse of Alameda and FTX sparked this period of crypto debt forgiveness, but more seriously, the number of entities that could rescue capital was low and highly leveraged, with balance sheets very strong, shrinking crypto space,” warned Panigirtzoglou in the report.

Both the FTX exchange and the company Alameda were founded by 30-year-old Sam Bankman-Fried. At the beginning of the month, several media outlets reported that the majority of Alameda's assets belonged to FTT tokens issued by FTX itself, which caused a wave of FTT sell-offs in the market.

Also, after the arrival of the FTX wave, Binance, the world's largest cryptocurrency exchange, initially announced that it would buy back FTX to fund the FTT sell-offs, shortly thereafter. announced not to buy FTX anymore, pushing FTX into an even scarier abyss.

Bankman-Fried told FTX investors that if it doesn't get the money, FTX will need to file for bankruptcy.

The market is worried that the bankruptcy of FTX will spread to the entire industry, forcing more institutions to go bankrupt.

Morgan Stanley analysts point out that Bitcoin will also be a member of the panic. According to their analysis, Bitcoin's cost of production can be used to measure how much its value declines, primarily as measured by the amount of electricity required to run the Bitcoin network.

Bitcoin currently costs $15,000 to produce, but it is likely to fall back to its summer lows of $13,000 around this time, the strategist said.

As of press time, Bitcoin is at $16,581.1, up 5.3% from Wednesday's close, but down more than 20% this week. Analysts say that while market sentiment seems to have stabilized for now, they are still very worried about the risks ahead.

However, the situation is still manageable. The demise of stablecoin TerraUSD and its sister token Luna in May underwent a reshuffle in the crypto market. Due to the TerraUSD crash, market leverage has been reduced, so the overall impact of this FTX crisis on crypto market value is likely to be small.


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