Bitcoin Is Only the Starting Point
Even tokens that lost value last year because they were tied to disgraced businessman Sam Bankman-Fried have gone up in value, with some more than tripling in value this month.
Even though there were worries about the future of Oxygen, Maps, Serum, Solana, and FTT after Backman’s arrest on fraud-related charges, their prices went up.
Analysis and reports show that the value of FTT, which was the token of his FTX exchange until it crashed, went up 160% in January. It is surprising that it happened to FTT after losing almost all of its value in 2022.
The price of these so-called “Sam Coins” has gone up along with a $250 billion recovery in the cryptocurrency market after a drop last year.
After Bitcoin, there are tokens for projects related to artificial intelligence, virtual real estate, and gaming.
The rallies are a sign that risky trading is back on the global markets because people are betting that the rapid rises in interest rates are almost over.
The most important question is whether the good start to the year a sign of better things is to come or a dangerous false dawn.
Noelle Acheson, a crypto newsletter writer, made a speculation that the cryptocurrencies would never find themselves free of volatility.
She also said that volatility is likely being made worse by the fact that many investors left digital assets during the selloff of 2022.
FTT used to be worth $80, but it dropped below $1 at the end of last year and is now worth more than $2.10.
Last week, the price of the controversial token went up. It happened because there were rumors that the people in charge of FTX’s bankruptcy might be able to start it up again.
Solana is a blockchain ecosystem that got a lot of support from Bankman-Fried and was once seen as a competitor to Ethereum.
Even though its future is still unknown, the price of Solana’s token has gone up from $10 at the end of December to almost $24.
Serum, a coin for a decentralized cryptocurrency exchange that was backed by Bankman Fried’s companies has witnessed a major boost.
The coin’s price has quadrupled to 43 US cents in three weeks. In 2021, when cryptocurrencies were going through a huge boom, it was worth almost $12.
Maps is a service for figuring out where to go, while Oxygen is a decentralized financial system.
They went up by more than 50% in January, but they are still only a small part of what they will be in 2021. Bankman-Fried was in favor of both ideas.
Insufficient Value of Cryptocurrency Tokens
A research analyst at CryptoCompare named Jacob Joseph stated that there is no fundamental value to these tokens.
Messari, a crypto tracker said that the coins may have gone up because some market participants quickly closed their negative bets as the price went up.
The excitement about the popular AI bot ChatGPT has spread past Sam Coins to cryptocurrencies.
This month, the price of Fetch.ai’s token has gone up from less than 10 cents to over 28 cents. Fetch.ai is a project that wants to combine digital ledgers and AI.
Virtual Cryptocurrencies Value Rises Despite Market Uncertainties
The metaverse is also taking part. In January, the currency of the virtual world Decentraland went up by 140%.
Even though Axie Infinity has become less popular over the past year, the value of an Axie Infinity token has gone up by more than 100%.
There are still a lot of worries on the horizon that call into question the optimistic attitude of investors shown by the wide range of smaller crypto assets.
One risk is the possibility of persistent inflation, which could raise interest rates for a longer time than expected and make people less willing to take risks.
Another risk is that the destruction of FTX will continue to spread, like when cryptocurrency lender Genesis Global Holdings LLC went bankrupt.
It looks like the markets for digital assets are stopping to figure out what to do next. At 6:50 a.m.
Monday in London, a gauge of the 100 largest currencies showed no change, and Bitcoin stayed at around $22,785 for the same amount of time.
Sources say that Bitcoin’s 37% increase in January was the biggest for the first month of the year since 2013. This helped the total value of crypto tokens pass $1 trillion.