The year 2022 has been a difficult one for cryptocurrency investors across the world. After witnessing a sharp fall in the price of most cryptocurrencies, the global cryptocurrency market is shaken by the looming collapse of FTX. A leaked balance sheet from FTX’s sister company, a crypto trading firm named Alameda Research reported that 40% of its asset were held in FTX’s own crypto token (FTT). Such high exposure led to questions on financial stability and governance. The once biggest crypto exchange (FTX) faced a liquidity crunch after customers started a bank run to
withdraw money from their accounts. FTX turned to Binance, an arch-rival, to bail them out. Initially, Binance agreed to take over FTX, but then pulled out of the deal, citing reports that FTX had mishandled customer funds and was being investigated by the authorities. This event led to a sharp fall in the prices of some of the major cryptocurrencies. Bitcoin fell below $16,000, its lowest level in two years.