The cryptocurrency market witnessed an unexpected surge on Sunday as FTT, the token associated with the defunct cryptocurrency exchange FTX, skyrocketed over 60% in a single day. This dramatic jump dwarfed the gains made by the rest of the market, which saw a 1.89% contraction in its total market capitalization over the same period.
FTT’s trading volume also saw a staggering increase of 3734%, indicating a strong buying pressure that propelled the coin to levels not seen since mid-March. This unexpected rally, however, comes amidst a backdrop of uncertainty surrounding FTT, which lost more than 90% of its market value following the collapse of FTX in the fall of 2022. The exchange’s bankruptcy was triggered by the revelation of fraudulent activities orchestrated by its founder, Sam Bankman-Fried, who was sentenced to 25 years in prison earlier this year.
The sudden spike in FTT’s price was attributed to rumors circulating online that FTX would begin repaying victims of the fraud starting September 30th. However, these rumors were swiftly debunked by Sunil Kavuri, an activist representing FTX creditors. Kavuri clarified that the next court hearing regarding the restructuring plan is scheduled for October 7th. If approved, creditors with claims below $50,000 might see distributions by the end of 2024, while those with larger claims may have to wait until the first or second quarter of 2025.
The dramatic price movement of FTT, despite its current lack of utility, showcases the volatile nature of the crypto market and the power of speculation. It remains to be seen whether this surge is a temporary blip or a sign of renewed confidence in the token, especially with the looming court hearing regarding the restructuring plan.
