According to FTX CEO and Founder Sam Bankman-Fried (SBF), the cryptocurrency industry is slowing due to aggressive rate rises implemented by the US Federal Reserve to combat increasing inflation.
However, he acknowledges that the regulator has few options in such a tough position. Nonetheless, the Fed’s proactive moves indicate that the cryptocurrency market’s direction will be directly dependent on central bank choices in the coming months. “The markets are literally terrified. People with money are terrified. “
A significant influence on the cryptocurrency market
The whole market capitalization of the cryptocurrency sector has fallen from $3 trillion in 2021 to less than $1 trillion now. So far, Bitcoin, Ethereum, and Solana have all lost over 60% of their value.
Meanwhile, firms such as Three Arrows Capital, Celsius, and Babel Finance are experiencing liquidity concerns. Platforms such as Coinbase (NASDAQ:COIN), Gemini, and Crypto.com, among others, have announced plans to downsize its personnel.
Outbreak is a danger
The CEO of FTX stated that his trading firm, Alameda Research, would consider acting to prevent the crypto industry from becoming infected.
His enterprises, he says, “have a responsibility to seriously consider intervening, even if at a loss to ourselves, to prevent the epidemic.” According to him, the present liquidity crisis is an issue for the whole industry, and everything necessary to rescue the ecosystem should be done.