FTX’s FTT token surges by 34% amid LedgerX parent firm acquisition news

Key FTX outlook:

  • FTX’s native blockchain asset jumps by 34%
  • FTX.US acquiring LedgerX parent firm fuelling the rally
  • FTT/USD pair facing selloff amid overbought concerns

JAIPUR (Coinchapter.com) – FTT, the native token of crypto derivatives exchange FTX International, broke out of its sideways trend and logged 34% intraday gains to tap a new all-time high of $70.72—all this Thursday.

The FTT/USD pair took off from $47 to print a near-vertical run to the said price amid FTX’s acquisition of the parent firm of Commodity and Futures Trading Association (CFTC)-regulated crypto derivatives exchange, LedgerX.

Redefining Crypto Derivatives In The US

The crypto derivatives market in the US is largely unregulated and highly competitive.

With $1.63 billion worth of open interest (unsettled contracts) in Bitcoin futures, the Chicago Mercantile Exchange (CME) is the only regulated player offering Bitcoin and Ether derivative products to investors. Derivatives are financial instruments that derive their value from the price of an underlying asset.

Collaboration With The CFTC

By acquiring LedgerX’s parent firm, the team behind FTX plans to sanitize the image of the crypto derivatives market in the United States. In addition, founder Sam Bankman-Fried announced a direct collaboration with the CFTC for achieving the same.

Related: Crypto Exchange FTX Creates WallStreetBets Composite Index For Betting On Assets

FTX.US And LedgerX Share Similar User Base

FTX.US and LedgerX share the same customer base – 70% institutional, 30% retail. FTT holders interpreted the same as a precursor to a potentially successful working deal between FTX’s US crypto arm and LedgerX.

Positive comments on derivatives from CEO Brett Harisson also fuelled the bullish sentiment around FTX’s native token.

“They are much more efficient means of trading when your two parties are interested in having financial exposure to a particular asset but aren’t so interested in necessarily holding that asset or at least holding that asset immediately.”

Brett Harrison said while clarifying the negative air around crypto derivatives trading

Safe, Non-Gamified Crypto Derivatives Trading

Additionally, long-time investors and potential FTT token buyers took into account Harrison’s plans to offer safe, serious, and professional crypto futures and options trading experience in the American market.

“It is important to make it clear from the beginning that this is a trading platform…it’s not a game with which to risk everything. And that’s not our goal. We want people to trade safely and responsibly.”

FTT/USD Overbought

LedgerX’s acquisition news and supportive comments (for crypto derivatives) from key FTX officials propelled the FTT/USD pair to new highs. But the pair flashed overbought alarms amid relative strength index (RSI) numbers touching 84.73.

FTT subsided from $70.72 to $65.36 as sellers showed up for immediate profit-taking. But bulls held the line and supported the upward trajectory. Nonetheless, the uptrend looks unsustainable, with fair chances of bears derailing the rally.

FTX's FTT risks dropping significantly after a face-melting rally.
FTX’s FTT risks dropping significantly after a face-melting rally. Source: FTTUSD on TradingView.com

FTT/USD risks dropping to the support near $52 if a selloff takes off in earnest. However, bulls would still look to buy the dips during the drop, restricting the downside intensity.

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ftx, FTX’s FTT token surges by 34% amid LedgerX parent firm acquisition news

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