Grim Year For Crypto Market After FTX Blowup: 'Players In The Space Are Kind Of In Survival Mode'

The crypto market is still reeling from the fallout of the FTX blowup last year. The market’s value has decreased significantly, NFT trading has plummeted, and venture capital deals have shrunk.

According to a Bloomberg report, Bitcoin BTC/USD has recovered by 60% this year, trading around $27,000, but it remains below the record high of $69,000 set in November 2021. The $3 trillion market has now shrunk to $1 trillion.

Trading volumes have dried up, and NFTs, once a hot commodity, have lost their allure. As per dappGambl, 95% of over 73,000 NFT collections are virtually worthless. The weekly traded value of NFTs now stands at $80 million, just 3% of the peak reached in August 2021.

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Investments in crypto and blockchain projects have also dwindled. VC deals have shrunk to about $7.3 billion this year, a quarter of the full-year tally in 2021 and 2022, as per Pitchbook data. Job losses in the industry have been significant, with employment declining at a rate of over 5%, according to Revelio Labs.

Nico Cordeiro, chief investment officer of crypto hedge fund Strix Leviathan expressed, "The revenue is minimal just because of the conditions in the market. You’re not bringing in new investors because nobody’s investing in the space. The players in the space are kind of in survival mode: Keep operations going for as long as it takes for capital to start returning to the space."

In the aftermath of the FTX collapse, legal proceedings against crypto firms like Genesis Global, Celsius Network, Voyager Digital, Three Arrows Capital, and BlockFi Inc. have been mounting. Coinbase Global Inc. COIN is battling SEC allegations, and Binance is embroiled in enforcement actions by the Commodity Futures Trading Commission and SEC.

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