The FTX Collapse affected the SOL DeFi to an Extent of Loosing $700 Million since the Incident!

The Crypto world is crippled with incidences surrounding the crypto market crash, the recent FTX fiasco among some of the monumental incidences of Ethereum merging and transitioning to the Proof of Stake consensus. With so much happening all at once with FTX being bought by Binance and then pulling out on its offer, followed by FTX getting hacked, the whole of the crypto ecosystem is confused as to what happened. Here is a timeline of the incidents taking place to simplify what all took place since the beginning of November.

TIMELINE OF THE FTX COLLAPSE: IN BRIEF

To recap, when the FTX exchange collapsed, the crypto market fell to a mere $ 786 billion from $1.02 trillion since the FTX fiasco scooped up all the crypto-linked assets. Nansen’s NFT-500 index reported a 14% sharp drop in Ethereum NFTs. Solana-based NFTs took a massive hit of 68% price drop which brought its valuation from $ 424 million to $ 135 million in a matter of days. The massive drop in price for Solana’s NFT is due to FTX’s advocacy for the Solana layer 1 solution. While the FTX was taking shape, the value of SOL crashed to $12 during November 14, 2022. Along with the FTX incidences that were affecting the entire crypto ecosystem, it also included the OG crypto ‘BTC’ along with Solana DEX called Serum (SRM).

Note: At the beginning of the meltdown FTT – the native token of the FTX exchange, was down by 89% while SRM was down by 53% in the last few days.

Read more: FTX collapse explained

The Fall Solana Defi

Back in November 2021, DeFi applications has made it possible for them to store more than $10 billion on the Solana network alone! The rise in SOL’s popularity was being led by some of the high-flying supporters that included Sam Bankman-Fried, the founder of the FTX crypto exchange, Multicoin Capital, Sino Global Capital among some other venture funds. Move to the present time, soon after FTX filed for Chapter 11 Bankruptcy and started facing proceedings, the value in SOL dropped by $300 million along with SOL loosing tens and millions of dollars, the amount of crypto that it had stranded in crypto assets on FTX, as reported by CoinDesk.

In a blog post yesterday, Solana Labs has stated the holdings of assets by the company. The blog said:

Solana Foundation asset exposure to FTX/Alameda

As of 11/14/22, the Solana Foundation has exposure to the below assets. These assets were held on FTX.com accounts (and continue to be held there) as of 11/6/22 when FTX.com ceased to process withdrawals.

• ~3.24m shares of FTX Trading LTD common stock
• ~3.43m FTT tokens
• ~134.54m SRM tokens

Read more here.