Bitcoin Rebounds From a Two-year Low With a 5% Increase Despite Traders’ Hesitance Following the FTX Collapse

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Last Updated on November 23, 2022 by Bitfinsider

Bitcoin surged higher on Wednesday, rebounding from its two-year low from the previous day, even as traders remained wary of possible contagion from the collapse of cryptocurrency exchange FTX.

At around 3:34 a.m. EST, the largest digital currency on the planet was trading at $16,497.19, up more than 5%.

Vijay Ayyar, vice president of corporate development and international at cryptocurrency exchange Luno, told Bitfinsider, “We’re bouncing off a support level, which is to be expected as we’ve been pretty oversold over the previous week or so.”

“However, this move does not yet suggest bullishness… Here, a negative reversal is possible, with $17K serving as resistance, followed by a decline to $14K,” he noted.

The demise of FTX, once a $32 billion empire and one of the world’s largest cryptocurrency exchanges, has left markets on edge.

Investors are concerned that the consequences from FTX could spread and are searching for indications of other companies or entities that may have had exposure to the Sam Bankman-Fried-founded exchange.

“In general, markets have been anxious since FTX, anticipating further contagion from FTX-related parties,” said Ayyar.

There could be more than one million creditors for FTX. The business owes its 50 largest unsecured creditors alone $3,1 billion. Nonetheless, according to a court filing published this week, FTX’s global businesses had just approximately $1.24 billion in cash on hand as of November 20.

Bankman-Fried, who resigned as CEO of the FTX earlier this month, has been attempting to rescue the exchange from his home in the Bahamas, a highly improbable effort.

Meanwhile, prominent crypto entrepreneur Justin Sun stated on Tuesday that he and his friends were exploring whether to acquire some of FTX’s holdings.

The digital currency ether

At 3:42 a.m. ET on Wednesday, gold prices increased by more than 7 percent to $1,161.89 per ounce.

Ether was under particular pressure after hackers stole approximately $477 million worth of bitcoin from FTX.

The hackers then changed a large sum, about $280 million, into ether before dumping the holdings into another cryptocurrency to launder the stolen funds. This sale exerted pressure on ether.

The cryptocurrency business has been beset by breakdowns, liquidity concerns, and bankruptcies throughout the past year. This year, the whole cryptocurrency market has lost more than $1,300,000,000,000,000 in value.

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