Bitcoin rises despite FTX court approval to sell crypto assets

POLAND - 2023/09/11: In this photo illustration, Bitcoin logo seen displayed on a smartphone with Coding in the background. (Photo Illustration by Omar Marques/SOPA Images/LightRocket via Getty Images)
Bitcoin rose today. Photo Illustration: Omar Marques/SOPA/LightRocket/Getty

Bitcoin ticked up despite a higher-than-expected inflation reading in the US and FTX gaining court approval to begin selling its crypto assets.

The world's largest digital asset by market capitalisation (BTC-USD) rose 1.4% in the past 24 hours to $26,320 (£21,075), according to CoinGecko. This is despite hotter inflation readings in the US and investor anticipation that the bankrupt FTX exchange will soon begin selling its remaining crypto assets.

Read more: Crypto live prices

US inflation in August rose for the first time since June 2022, rising to 3.7% after an increase in energy prices. This was hotter than July's 3.2% reading and above the consensus forecast of 3.6%.

Inflation remains far above the Federal Reserve’s target rate of 2%. August's reading leaves the door open for further interest-rate hikes from the US central bank.

FTX gets approval to sell remaining assets

On Wednesday, FTX received US court approval to commence liquidation of its remaining cryptocurrency assets. The sell-off will allow the bankrupt exchange to repay creditors in US dollars and minimise risks related to price volatility in crypto markets.

FTX's proposal was granted at a court hearing in Wilmington, Delaware. The details involve the exchange being allowed to sell up to $100m (£80m) in cryptocurrency per week. The firm can also enter into hedging and staking agreements that will allow it to minimise the risk of price volatility and earn passive income through staking crypto tokens, like ether.

Altcoins rally despite FTX liquidation fears

Major altcoins did not suffer a market route after the FTX liquidation proposal was granted. The bankrupt exchange's remaining crypto-asset holdings are heavily weighted towards blue-chip altcoins, particularly solana and ether.

Apart from having over $560m (£448m) in bitcoin, FTX also owns $1.16bn (£0.93bn) in solana (SOL-USD), $192m (£153m) in ethereum (ETH-USD), and $137m (£109m) in aptos (APT-USD), according to a recent court filing.

Solana holders showed no sign of trepidation considering how much of the token could be sold gradually over the coming weeks. SOL posted a 3.4% gain in the past 24 hours, to a current price of $18.83 (£15.08).

However, traders may be anticipating that the remaining FTX holdings in solana and ether could be staked rather than sold on the open market, so the bankrupt firm could gain yields on the assets.

Read more: Spot bitcoin ETF approval unlikely this year, says analyst

The global cryptocurrency market capitalisation increased by 1.4% in the past 24 hours to $1.09tn (£0.87tn), according to CoinGecko data. Some of the inflows that have buoyed the market have trickled down to memecoins. Of the top ten memecoins by market capitalisation, most were in the green today.

Dogecoin (DOGE-USD) saw a modest gain of around 1% in the past 24 hours to $0.061. However, Harry Potter Obama Sonic 10 Inu (HPOS10I) posted a 25% rally. The anarchic memecoin has retained its position at the number eight spot in the memecoin top ten.

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