"More Companies to Close" Warning After 'FTX Bankruptcy Filing' Aftershock

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Voices warning of the aftermath of FTX, one of the world's top three cryptocurrency exchanges, which filed for bankruptcy protection due to a liquidity crisis, are pouring in. There are also warnings that companies will close one after another within weeks.

According to major foreign media on the 18th (local time), Multicoin Capital, a cryptocurrency venture company, sent a letter to investors the day before stating, "The FTX incident could lead to further collapses," and "Many trading companies could be swept away or shut down due to this incident."

They also predicted that more collapses are expected due to the sudden downfall of FTX and its subsidiary Alameda Research, and that the bearish trend in the cryptocurrency market will not change anytime soon. Multicoin is one of the companies that invested in FTX and is concerned about losses. Although it is expected to recover a quarter of the FTX investment, 15.6% of the fund is still locked.

The investment rating of Coinbase, the largest cryptocurrency exchange listed on the New York Stock Exchange, was also downgraded. Bank of America lowered Coinbase's investment rating from 'Buy' to 'Neutral' on the same day, citing the aftermath of the FTX incident. Jason Kupferberg, an analyst at Bank of America, stated, "Due to the recent collapse of competitor exchange FTX, Coinbase is likely to face several new headwinds in the short and medium term." Earlier, Daiwa Securities also downgraded Coinbase's rating from 'Buy' to 'Neutral' on the 11th.

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