Bitcoin’s Bearish Pressure Rises as FTX Begins Repayments for Claims Below $50K
There is pressure to fall on the price list as FTX begins its repayment process and injects liquidity into the market. As a result, Bitcoin has difficulty building the buying momentum expected by analysts, as FTX repayments will increase.
FTX allocates $1.2 billion in Phase 1
FTX has begun repaying its creditors on February 18, indicating a move towards a crisis that has had a huge impact on the market. Many people affected by exchange failures have suffered significant financial losses, including those who allocate money for big shots, such as buying a home or paying for their children’s education.
Specifically, those who lose up to $50,000 will recover 100% of the amount they requested plus 9% interest, starting November 11, 2022, the day that FTX goes bankrupt.
FTX creditor Sunil mentioned in a tweet that the first round of repayments totaled $1.2 billion, and about $800 million has been allocated. This has reached about 162,000 accounts, covering 35% of the approximately 460,000 accounts eligible for claiming.
As far as these funds are allocated, half of the funds have been paid directly to the original account holder, while the remaining half has been allocated to those who have already obtained the debt.
This repayment method involves the initial victims of the collapse and the secondary parties who have subsequently taken risks by purchasing these debts.
Please read also: FTX repayment value $16B, start tomorrow – will this process be turned into bitcoin and altcoins?
Many recipients of FTX repayments are expected to reinvest their funds in cryptocurrencies, some buy Bitcoin or Bitcoin ETFs, and others invest in AltCoins like Ethereum. However, as BTC prices fail to obtain any significant purchase demand, it is uncertain whether these repayments will have a significant impact on Bitcoin’s price.
In recent hours, BTC’s price has dropped from its high price of $96,730 as it’s price has dropped significantly. Now, it’s targeting $94,000.
Next is Bitcoin’s expectations?
The impact of these payments on the market is unclear. Some experts believe that some of this funds may flow back to cryptocurrencies, thereby enhancing liquidity.
However, since the repayment plan has a smaller claim against creditors, it may not immediately affect market prices. Furthermore, many recipients may choose to invest safer than reenter the market that continues to volatile.
Currently, Bitcoin is dropping unexpectedly after repayment. RSI levels have reached the sales zone at Level 31, indicating that Bitcoin may continue to trend downward.
Buyers are now aiming to reverify the $92,000 region to verify further trends. If Bitcoin rebounds above are the region, we may see a merger below $95K. On the other hand, a drop below $92K will turn the price of BTC to $89,000.
