2025: Bitcoin, Bots & Big Money Moves | Risk On!
Despite the fears of some traders, bankrupt crypto exchange FTX’s upcoming liquidations aren’t likely to flood the market, according to Coinbase’s head of institutional research.
David Duong notes in a recent analysis that FTX’s crypto liquidations are governed by weekly sell limits of $50 million per week for the initial phase and $100 million per week in subsequent weeks.
Court documents indicate FTX was holding around $1.162 billion worth of Solana (SOL), $560 million worth of Bitcoin (BTC), $192 million worth of Ethereum (ETH) and $1.49 billion worth of various other digital assets as of August 31st.
Duong says there “are strict controls in place for selling certain ‘insider-affiliated’ tokens that require 10 days advance notice to these same committees.”
The Coinbase researcher also notes that the vesting schedule of FTX’s Solana holdings will lock up a large chunk of the bankrupt exchange’s SOL until 2025. Additionally, he says FTX will be able to hedge its crypto sales through an investment advisor if it receives prior committee approval.
On a macro level, Duong says he still expects the U.S. Federal Reserve to ease monetary policy in the first or second quarter of 2024, even if it chooses to hike rates again later this year.
“As we said in our August Monthly Outlook, we believe expansionary fiscal policy is pro-cyclically keeping the US economy preternaturally strong for the time being. But underneath the seemingly healthy top-level indicators, labor markets have peaked, credit conditions have tightened, loan delinquencies are rising and student loan repayments will restart in October. We think a dual expansionary fiscal and monetary regime should be very supportive for Bitcoin in particular as an alternative to the traditional financial system.”
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