The fallout from FTX Crypto Exchange’s rapid collapse isn’t sparing B.C. firms specializing in cryptocurrencies.
West Coast companies trading on the public markets have taken a shellacking this past week as investors weigh the value of these speculative assets.
Bitcoin’s value has plunged more than 20 per cent, sending shockwaves across publicly traded companies specializing in cryptocurrencies.
And a number of Vancouver-based firms specializing in cryptocurrencies have been caught up in the ensuing rout:
- WonderFi Technologies Inc. (TSX:WNDR) shares have fallen 19 per cent over the past week
- HIVE Blockchain Technologies Ltd (Nasdaq:HIVE) shares are down 7.5 per cent
- Mogo Inc. (TSX:MOGO) shares are down seven per cent
- LQwD FinTech Corp. (OTCMKTS: LQWDF) shares are down 28 per cent
- DMG Blockchain Solutions Inc. (OTCMKTS: DMGGF) shares are down five per cent
- BIGG Digital Assets Inc. (CSE:BIGG) shares are down 23 per cent
FTX was one of the world’s most popular crypto exchanges prior to a Coindesk leak earlier this month that revealed Alameda Research, the trading firm of former FTX CEO Sam Bankman-Fried, was using his exchange’s own tokens (known as FTT) as collateral against loans rather than a fiat currency or another cryptocurrency.
The revelations pushed investors to pull their assets out of FTX, including one major holder with a link back to B.C.
Competing exchange Binance, which was founded by Chinese-born Changpeng Zhao who grew up in Vancouver from age 12 to the time he attended McGill University, liquidated its FTT holdings soon after the Coindesk report.
Days later, Binance pulled out of a potential deal to absorb FTX when it took a look at its books.
The move sealed FTX’s collapse.
“The events of the past week are tough to watch with the crypto sector reeling from the collapse of FTX,” said BIGG CEO Mark Binns, whose company is best known as the owner of crypto brokerage Netcoins.
But the Vancouver-based firm said in a release it does not have any exposure to FTX, Alameda or the FTT token.
WonderFi also said last week both it and its subsidiaries have any exposure to FTX, Alameda or the FTT token.
