Bitcoin and other cryptocurrency markets dropped today to one-week lows after the hacker who is believed to have drained the accounts of the recently bankrupted crypto exchange FTX Trading Ltd. began trading their ether currency for bitcoin.
Over the weekend, the hacker began swapping their ill-gotten Ethereum coins taken from the attack on FTX, which reportedly happened mere hours after the exchange filed for bankruptcy on Nov. 12. During the attack on Friday, researchers documented suspicious transfers of approximately $515 million in cryptocurrency outflows from FTX’s accounts before the exchange confirmed it had been hacked.
Over the weekend on Sunday, the attacker began moving their coins starting with 5,000 Ethereum for bitcoin, according to blockchain security company PeckShield.
Bitcoin’s price has fallen by 2.65% in the past 24 hours to $16,131, according to CoinMarketCap. Earlier in the day, it plunged to a one-week low of $15,943, driven by the recent bankruptcy of FTX and volatility from the sudden movement of coins. Ethereum has also followed suit, falling 3.64% to $1,130 in the past day from $1,176.
Cryptocurrency markets more broadly have seen significant drops since the collapse of the FTX empire, once headed by Sam Bankman-Fried who resigned as chief executive upon the announcement of its bankruptcy. This further action by the FTX hacker has further suppressed markets. CoinMarketCap shows that there has been a 2.72% decrease in the global crypto market cap, which has fallen to $800.9 billion.
The trouble for FTX began on Nov. 6 when crypto exchange Binance Ltd. CEO Changpeng Zhao reported that he intended to liquidate its stake in FTX’s native token FTT in order to withdraw its investment in FTX. This ignited the collapse of FTX. This led to rumors that FTX was insolvent, the exchange falling into an illiquidity crisis, which ultimately to its bankruptcy.
Cryptocurrency markets had already fallen significantly from all-time highs of over $68,000 in November 2021 after what has been dubbed “crypto winter” during 2022 propelled by a broad decline in markets and the crash of the TerraUSD stablecoin ecosystem in May, which saw Bitcoin initially fall below $30,000 at the time. Compared to the same time last year, Bitcoin’s value has fallen 76% and Ethereum has fallen 73% over the same period.
The identity of the FTX hacker is still unknown, although investigations are still ongoing. Speculation abounds about how this could have happened and the timing of the event, mere hours after the bankruptcy announcement, has stirred further controversy for the embattled exchange.
Other major cryptocurrencies have also fallen in the last 24 hours including the meme coin Dogecoin down 7.9%, Solana down 8.3%, and XRP down 5.1%.
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