Coinbase: FTX Crisis May Extend Crypto Winter Through 2023

Experts from the American crypto exchange Coinbase believe that the collapse of the FTX exchange affected too many companies – this will prolong the crisis in the cryptocurrency market for at least another few months.

Coinbase published the report “The Long Winter Will Be Even Longer”, in which the company’s analysts studied the consequences of the collapse of the FTX crypto exchange on the cryptocurrency market. According to experts, the liquidity crisis of the third largest crypto exchange in the world will definitely extend the crypto winter – experts believe that until the end of 2023.

The study highlights that many institutional investors’ investments in FTX are stuck on the platform. This will cause a lot of distrust not only for those associated with the crypto exchange, but for the entire industry as a whole. Analysts note that the dominance of stablecoins has reached a new high of 18%, and this indicates the protracted nature of the crisis.

What is happening means that crypto market participants are selling their digital currencies and withdrawing funds to dollar-pegged stablecoins to ride out the crypto winter.

The fact that FTX filed for bankruptcy, experts say, is definitely positive, but the number of companies associated with FTX or its subsidiary Alameda Research is really large – someone issued loans to the crypto exchange, someone simply invested money.

Correcting the situation and regaining the confidence of users and investors will require at least a few more months of work, analysts say.

Earlier it was reported that institutional investors began to become disillusioned with cryptocurrencies even before the collapse of the FTX exchange, but the bankruptcy of such a large company could forever cross out the prospects for digital currencies among traditional finance market participants.