The collapse of the FTX cryptocurrency exchange has been a massive blow to the entire crypto space.

The cryptocurrency market has experienced selling pressure once again, with Bitcoin dropping more than 5% to below $16,000 for the first time in two years.

Where Bitcoin touched a new low in 2022, as it fell to the level of $ 15,870 with an estimated market value of $ 300 billion, to rebound and rise above the level of $ 16,500.

Over the past week, the cryptocurrency market has lost more than $200 billion.

Data from Coinglass shows that market liquidity has been drying up very quickly recently which could be a concern going forward.

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Amid the recent collapse of cryptocurrency exchange FTX, users’ trust in centralized platforms has plummeted.

The total balance of bitcoins on exchanges has fallen to the lowest level since 2018 at just under 2.3 million bitcoins.

Quoting from Glassnode:

80.8 thousand bitcoins have left the trading platforms over the past four days.

It is clear that people take bitcoins off trading platforms to reduce counterparty risk.

Exchange data can fluctuate in the short term.

We imagine this trend will continue as more people take custody of the asset and avoid trusting a third party.

Solana suffers the most due to concern from FTX’s sister company, Alameda Research, which has been selling off SOL properties in massive quantities since the crisis erupted.

As a result, the Ethereum competitor has corrected the most of all the altcoins; The Solana coin crashed more than 54% in one week.

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As of press time, SOL is trading at $14.4 with a market capitalization of $5.2 billion.

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The Bloomberg report notes:

Tokens issued by Serum, a liquidity infrastructure hub set up by FTX and used by market makers and Solana lending protocols, fell more than 23% on Sunday alone.

Developers associated with Serum have forked the project’s fork code amid concerns that the upgrade key that controls the software could be hacked.

At press time, altcoins have rebounded after a deep correction.

Dogecoin (DOGE) is down 24% in the last 7 days and Polygon (MATIC) price is down 19% in the last 7 days.

While the price of Ethereum (ETH) has fallen by 20% in the last week, moving back below $1,300.

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