In a Nov. 6 report from Kaiko, a number one supply of cryptocurrency market information, regardless of Bitcoin’s rally in October, the Alameda hole nonetheless exists one yr after the FTX collapse.

Information reveals that market depth continues to be 55% under pre-FTX ranges.

Low volatility setting

Though bitcoin has seen a 20% surge in October 2023, the Alameda hole, additionally outlined because the sharp decline so as e book liquidity evident after the collapse of FTX and its sister firm Alameda Analysis — has continued.

Kaiko reports Alameda gap still exists - 1
The Alameda Hole Persists | Supply: Kaiko

The two% market depth for BTC, ETH and altcoins on centralized exchanges hovered at $800mn in information from final week, nonetheless nicely under pre-FTX ranges.

Whereas Kaiko likens this partially to the low quantity and low volatility setting, which has saved superior merchants and liquidity suppliers away from the cryptocurrency market, the information supplier additionally highlights there are additionally structural causes, together with market makers leaving the house after struggling losses or abandoning the digital asset market altogether after FTX. 

Following solvency considerations

The final yr has saved a lot of the crypto neighborhood on the sting of their seats after the unfolding developments across the collapse of FTX, one of many world’s largest crypto exchanges. Kicked off by a report from CoinDesk highlighting potential leverage and solvency considerations, the risky crypto market took a billion greenback hit, spurring on a liquidity disaster for the change.

In late December, now ex-CEO Sam Bankman-Fried was arrested within the Bahamas and extradited to the US, pleading harmless to all legal fees in January, with the jury later discovering Bankman-Fried responsible on all fees.

With the marketplace for cryptocurrencies like Bitcoin now on the uptick, the query stays, is the world prepared to maneuver previous the FTX period?

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