Just when almost everybody was beginning to feel the crypto world was maybe bottoming out and cryptocurrencies were beginning to show green shoots a new and stronger hurricane has sent prices in a tizzy again.
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Not too long ago, Sam-Bankman Fried’s FTX had swallowed up troubled crypto firms and the moves looked like they could stave off the storm but life comes full circle and now FTX itself could be gobbled up by Binance.
The development comes as concerns over liquidity challenges at FTX grew into a chorus and now the two crypto exchanges have signed a non-binding letter of intent with due diligence expected to begin soon.
To add a twist to the drama, CoinDesk reports Binance could walk away from the transaction after taking a look under FTX’s hood.
Today, the two major cryptocurrencies, Bitcoin (BTC-USD) and Ethereum (ETH-USD) are down 16% and 24% respectively already with a combined market capitalization of less than half a billion USD.
The development has sent prices crashing on Wall Street as well. Coinbase Global (NASDAQ:COIN) is down 10%. The crypto exchange recently mined lower-than-expected third-quarter numbers while it focuses on optimizing costs and retaining users.
Today, Daiwa analyst Carlton Lai has lowered the stock’s rating to a Hold from a Buy and has a $52 price target on the stock. COIN shares have nosedived 81% so far this year already.
Cryptominer Riot Blockchain (NASDAQ:RIOT) too is down 7.5% today. This week, RIOT reported 28.5% lower revenue for the third quarter while it continues to amp up its hash rate capacity (5.6 EH/S).
Robinhood Markets, (NASDAQ:HOOD) which has dropped 76% over the past year is also down nearly 10% today as the meme mania favorite continues to take blows from a fall in equities as well as crypto.
HOOD’s recent third-quarter numbers lagged on the revenue front while its crypto revenue dropped 12% sequentially. Today, Barclays’ Benjamin Budish has reiterated a Sell rating on the stock while lowering the price target to $10 from $12.
As central banks around the world continue to suck liquidity out of the markets, one cannot help but feel the fall of dominos in the cryptoverse may not be over yet.
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