FTX collapse has “Negligible” influence – crypto.news
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The Solana Foundation had disclosed that they held less than 1% of the Solana Foundation’s cash or cash equivalents when FTX stopped processing withdrawals, which is immaterial to the foundation’s operations. However, the foundation’s press release said that Solana lost more than $180 million in crypto assets.
Solana’s transparency in the FTX transaction
Blockchain platform Solana updated its website on Monday, November 21, revealing dealings with the infamous FTX.com.
They stated that they had approximately $1 million in cash or other cash on FTX.com on 11/6/22 when FTX.com stopped processing withdrawals; this is less than 1% of Solana Foundation’s cash or cash holdings, meaning that the FTX collapse and contagion will have little impact on their operations. They also state that they had no SOL on FTX.com.
Although Solana (SOL) was not organized on FTX, the organization has lost much more crypto assets. About 3.43 million FTX (FTT) tokens and 134.54 million Serum (SRM) tokens belonging to the foundation are now trapped in the exchange.
The foundation also owned 3.24 million shares of FTX common stock, which do not appear to be coming back anytime soon.
According to experts, FTT, FTX’s utility token that gave holders reduced trading fees on the platform, was trading above $22 before the collapse. SRM, the Regime Token of Serum – a scaling-focused DEX protocol launched by a consortium of the infamous FTX, Alameda Research, and the Solana Foundation, were worth around $0.8 each.
According to figures from the Solana Foundation, this is $75.46 million and $107.6 million for exposure to FTT and SRM, respectively. With the collapse of FTX, FTT dropped to only $1.32, while SRM was at $0.32 yesterday, November 24th.
Sollet Bitcoin – the tokenized version of Bitcoin in Solana – also lost its price peg to the primary cryptocurrency after the FTX crash. While FTX was responsible for holding the Bitcoin behind these tokens, the November 10 balance sheet disclosures show that the exchange had zero Bitcoin on its asset side.
Solana’s foundation claims to have held another $40 million in Sollet-based assets such as soBTC as of that date. “The status of the targeted assets is currently unknown” it added.
Even SOL has suffered heavy losses since the crash. In November last year, it hit an all-time high of $259 a piece. This month, it has dropped below $15 and was removed from the top ten cryptocurrencies by market capitalization.
Solana keeps everything through the stiff upper lip.
Despite these losses, Solana had stated after the bill that its network had “not experienced any significant performance or availability issues”. The blockchain is known to have suffered several outages in the past and recovered.