“Bitcoin is showing resilience here but it is hard to imagine investors are ready to test the waters until we learn more of the full contagion risk associated with FTX,” Edward Moya, senior market analyst for foreign exchange market maker Oanda wrote, although he warned that “if more exchanges or crypto companies pause withdrawals or limit activity, that will likely bring back the pressure on cryptos.
Ether was recently changing hands at about $1,250, up about 1% from Monday, same time. Other major altcoins spent much of Tuesday in the green with even FTX's FTT token climbing 20%. FTT was, nevertheless, recently trading at $1.81, a fraction of its near $36 highs earlier this year. SRM, another FTX-related casualty that had slumped more than 72% over the weekend, rose more than 3%.
Equity markets rose slightly, buoyed by October's PPI, indicating that U.S. central bank monetary policies were staunching inflation. The tech-heavy Nasdaq was up 1.4%, while the S&P 500, which has a strong tech component, and Dow Jones Industrial Average climbed 0.8% and 0.1%, respectively. Oanda’s Moya noted warily that a possible BlockFi bankruptcy could present crypto markets with their next big test. The lender denied rumors that a majority of its assets were held at FTX, buton Monday that in addition to having deposits on the platform, it had an undrawn line of credit from FTX and obligations that FTX owed it.
“The next domino to fall appears to be BlockFi,” Moya wrote. “Contagion from FTX was widely expected to impact BlockFi despite their recent denial that a majority of their assets are custodied at collapsed crypto exchange FTX.”
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