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Solana tokens pegged to bitcoin and ether lost parity in FTX chaos

Published

2 years ago

13 November 2022

Rédaction Etherdesign

Sommaire Afficher

Key facts:

These tokens were issued by Alameda, a company owned by the former CEO of FTX.
The prices of SOBTC and SOETH are down 75% and 8%, respectively, from their collaterals.

Bitcoin (BTC) and Ether (ETH) tokens on the Solana blockchain lost parity with their underlying cryptocurrencies. It happened in conjunction with the collapse of FTX, the cryptocurrency exchange that had a close relationship with the network.

According to data provided by price monitor CoinGecko, Bitcoin wrapped (Sollet)identified by the ticker SOBTC has lost parity with BTC as of Friday, November 11.

This was accentuated last Sunday, when the token traded at an average of $2.607. This is a drop of almost 75 percent, taking into account that 1 BTC is trading above $16,630, as can be seen in the CryptoNews price calculator.

The graph shows the parity loss of the bitcoin token in Solana compared to its underlying asset, BTC. — The bitcoin tokenized on Solana has lost parity with its underlying asset. Source: Coingecko.

In the case of Wrapped Ether (Sollet)or SOETH, the token also broke parity with the underlying cryptocurrency last Friday. This Sunday it is trading at $1,049, down 8 percent.knowing that 1 ETH is valued at about US$1,230.

The graph shows the parity loss of the Ether token in Solana compared to its underlying asset, Ethereum ETH. — The Ether tokenized on Solana has also lost parity and has not yet regained it. Source: Coingecko.

The loss of parity of BTC tokens and ETH a Solana followed Friday’s announcement by FTX that. formally announced its bankruptcy and that its CEO, Sam Bankman-Fried, has resigned from his position.

As it happens. these tokens are issued in Solana by FTX and Alameda Research.both companies involved in the dispute and part of the group of 130 companies that have filed for Chapter 11 of the U.S. Bankruptcy Code. The fact that they have filed for bankruptcy, prevents tokenized bitcoins and ethers from being redeemable.

The bankruptcy filing adds to the crisis at FTX, which has been in the news since last week, when charges were made public against Bankman-Fried for setting up a scheme to lend with secured FTT tokens, and then for the alleged misuse of funds.

Solana, former FTX CEO’s favorite network.

As reported by CryptoNews, Solana and SBF had a close relationship. This was to the point that the now former CEO of the collapsed exchange. said in an interview that that the project was the “most underrated” in the ecosystem.

Indeed, as a sign of this relationship, the Solana (SOL) token, decreased by almost 50 percent after the news of the Binance and FTX sale agreement (now canceled), as reported by this media outlet.

At press time, SOL was negotiate Of the order of $14, after falling 6.50 percent in a single day.