Centralized stock market explosions have limited effects on Defi

Centralized stock market explosions have limited effects on Defi

While Binance thinks about taking over FTX, the shocking events related to the possible rescue operation for the stock exchange of Sam Bankman-Fried by the rival CEO Changpeng (CZ) Zhao subdued the mood in the crypto community. But there is a ray of hope: the defi exchange volume increases significantly.

ftx.com customers do not yet know whether or when they will have access to their funds, and the prices for crypto systems have fallen on a broad front to new annual low.

Alameda Research, the trading company founded by Bankman-Fried, deleted its website, which contributes to the dark prospects.

In an interview with block works, Bobby ONG, COO and co -founder of Coingecko Research could be exposed.

It is still uncertain whether we are dealing with another Three Arrows Capital (3AC) situation in which companies have to liquidate considerable positions in a hectic struggle for liquidity, probably with loss, he said.

"As we saw in the 3AC case out, these liquidations can also have radiation effects on other tokens-for example, the Solana (Sol) price has already suffered in the past few days," said Ong.

The Solana connection

Bankman-Fried was an former investor in Solana and one of the largest investors for projects in the ecosystem. At the time of writing this article, the price of SOL is $ 14.30, which corresponds to a decline of around 40 % compared to the previous day.

According to the research analyst of Blockworks, Dan Smith, the tank prices of Solana are only the beginning.

"More pain is emerging on the horizon from 57.6 [Million] Sol is taken away and at around 3:00 a.m. If both the SOL Prize and network security are impaired.

Smith added: "The costs of corruption or the amount to dollars that is needed to take control of a POS network are also significantly affected."

dealers turn to defi exchanges

The whole chaos unfolding has a silver litter on the horizon.

ryan Rasmussen, a crypto research analyst at Bitweise, told Blockworks: "Regardless of where the processing ends, it is the same as: Defi is more robust, more transparent and scalable than CEFI."

"While the effects of the insolvency of FTX and the sale we see today, the Baisse will extend, at least the compromises that users decide for centralized services to decentralized emphasize events like this.

"It is a hard - and expensive - lesson, but it is essential. This is positive for Defi in the long term," said Rasmussen.

This feeling shares Calanthia Mei, co -founder of Masa Finance, a decentralized identity log. Mei said Blockworks that the events that occurred in the end really showed how important transparency is.

The turbulence on centralized stock exchanges "not their keys, not their coins", and dealers have increased to decentralize alternatives such as Z uniswap.

Bankman-Fried previously expressly praised ftxs "24/7 risk engine", which is said to be an improvement compared to traditional financing.

"If you think about how the whole drama has developed, it is primarily about the dark relationship between FTX and Alameda Research," said Mei. "I am confident that Defi protocols-which are largely secured-will be able to call up money from Alameda."

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The Post Centralized Exchange Blowups have limited impact on defi is not a financial advice.