Confidence in crypto exchange tokens returns from FTX lows

Crypto exchange tokens have crossed their FTX loss lows and recovered or reached new all-time highs as part of a continuing bull market.

At press time, Binance's home token, BNB, is currently trading at $352, representing a 32% gain since November 2022. Troubled cryptocurrency exchange FTX declared bankruptcy and spread fear across the crypto exchange ecosystem.

Additionally, BNB is trading higher than its June 2023 high, as news of the ongoing investigation into the exchange by the US Department of Justice (DOJ) and the US Securities and Exchange Commission (SEC) first broke. The exchange settled with the DOJ for $4.3 billion, while the SEC lawsuit is ongoing.

Exchange tokens, issued by the centralized entities themselves, allow users to access trading benefits on exchanges. They can also participate in blockchains created by centralized exchanges to pay for gas bills and decentralized finance. Some exchange tokens allow users to participate in platform management activities.

Meanwhile, the OKX exchange's home token OKB is up 132% from FTX lows, up a total of 3,227% since its launch in May 2019. billion in a matter of minutes before fully recovering and hitting a new all-time high. The short market sell-off that day resulted in a lot of leveraged liquidity in the OKX platform for lending, margin trading and cross-currency trading. The exchange compensated affected users through an airdrop.

Likewise, Biget exchange's BGB token rose to $1.03 with a 159 percent year-over-year gain. Last September, the exchange pledged $100 million in funding for blockchain, AI, and Web3 projects dubbed “EmpowerX.” BitGate Managing Director Gracie Chen said at the time that the company expects more investments, mergers and acquisitions in the coming months.

Unsurprisingly, FTX's FTT token has lost more than 90% of its value before the bankruptcy. Although the exchange expects to pay customers in full, excluding forfeiture fees, the exchange itself will not restart.

“No investor is prepared to provide the necessary capital to restart an offshore exchange, nor has a buyer come forward for that exchange,” said bankruptcy attorney Andy Dietderich. “The costs and risks involved in creating a proper exchange from which Mr. Banman-Fried were left in the dumps were too high.

Related: Hong Kong crypto stocks on the rise, OKX to invest in L1s: Asia Express