The crypto market has been battered this year, with over $2 trillion wiped from its value since its peak in November 2021. Cryptocurrencies have been under pressure after the collapse of major exchange FTX.
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Bitcoin reversed higher on Tuesday after briefly hitting a two-year low, as investors assess the potential damage yet to come from FTX’s collapse.
The largest cryptocurrency by market capitalization last traded up 2% at $16,131.74, according to Coin Metrics. Earlier in the day, it fell to $15,480, its lowest level since Nov. 11, 2020. Ether rose 2% to $1,127.30.
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The bounce followed reports that Justin Sun could potentially buy assets from FTX. The crypto entrepreneur told reporters on Tuesday that he and his associates “are open to any kind of deal” and “all options are on the table.”
The cryptocurrency market has lost more than $1.4 trillion in value this year as the industry has been plagued by issues ranging from failed projects to a liquidity crunch, exacerbated by the fall of FTX, once one of the largest stock exchanges in the world.
Crypto’s latest troubles began after Binance CEO Changpeng Zhao said his exchange would sell off its FTT tokens. FTT is the native digital currency of the FTX crypto exchange. Binance’s move caused the collapse of FTX, a company once valued at $32 billion. FTX has since filed for bankruptcy.
To make matters worse, hackers stole approximately $477 million worth of cryptocurrency from FTX, most of which was converted into digital ether. But hackers have started laundering this bitcoin money. Because they sell ether, the price of ether has also been under pressure.
Ether was trading down nearly 2% at $1,109.55 as of 8:12 a.m. ET.