The cryptocurrency sector was rocked when FTX went down. As a result, the prices of Bitcoin and other digital currencies dropped markedly.Fake images
Jakub Porzycki | Nurfoto | fake images
AJ Investment Analyst Bell reported that he has noticed “no signs of contagion” from digital currencies to other traditional investments.
A huge amount of money was destroyed when the FTX exchange failed. This has caused many to wonder if fluctuations in the crypto world could have any effect on other economic systems.
“Crypto has a lot of money, but it’s built as a separate ecosystem,” Chief investment analyst Laith Khalaf commented on “Squawk Box Europe” on Wednesday.
Despite this, this does not necessarily imply that there will not be some kind of connection between the two sectors in the future.
“If we had a more widespread problem across the system, it could start to be seen affecting other assets,” Khalaf stated, “but I don’t really see that,” he concluded.
According to two court filings in November, FTX was likely to have more than 1,000,000 creditors. The top 50 unsecured creditors owe $3.1 billion.
The exchange’s founder and former chief executive, Sam Bankman-Fried, was charged with fraud on Tuesday after being arrested on Monday.
Highly Volatile Asset
Khalaf was hesitant to predict where cryptocurrency would go next due to its extreme volatility.
“We could be talking this time next year and [Bitcoin] could be at $5,000 or $50,000. It wouldn’t surprise me because the market is strongly driven by sentiment,” he said.
Despite doubts regarding the long-term adoption of cryptocurrencies, Khalaf was certain of one thing.
“The future is certain [cryptocurrency] “Remains a highly volatile, speculative asset,” he said.