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The collapse of FTX has sent shockwaves through the cryptocurrency industry. The price of bitcoin and other major digital coins have fallen sharply as problems at FTX emerged.
Jakub Porzycki | Nurphoto | Getty Images
There are “no signs of spillover” from cryptocurrency into more traditional assets, according to an investment analyst from AJ Bell.
Billions of dollars were lost when the exchange FTX collapsed, raising questions about whether movements in the crypto sphere could ricochet through to other financial systems.
“Crypto has a lot of money but it’s kind of built up as a separate ecosystem,” head of investment analysis Laith Khalaf said on “Squawk Box Europe” Wednesday.
But that doesn’t necessarily mean there couldn’t be some overlap in the future.
“If we had a more system-wide issue you could start see it affecting other assets,” Khalaf said, “but I don’t really see that,” he added.
In two separate court filings, FTX’s lawyers said in November that it likely had more than 1 million creditors, and owes its top 50 unsecured creditors $3.1 billion.
The founder and former CEO of the exchange, Sam Bankman-Fried, was then charged with defrauding investors Tuesday after being arrested Monday.
A ‘highly volatile’ asset
Khalaf was reluctant to make predictions as to where cryptocurrency will go next because it’s so changeable as an asset.
“We could be sitting here talking this time next year and [Bitcoin] could be at $5,000 or $50,000. It just wouldn’t surprise me because the market is so heavily driven by sentiment,” Khalaf said.
And while there are questions as to the long-term adoption of cryptocurrency, Khalaf made one point with a lot of certainty.
“For the foreseeable, [cryptocurrency] remains highly volatile and speculative asset,” he said.
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Image and article originally from www.cnbc.com. Read the original article here.