Recently, the attention of crypto enthusiasts has been directed not to already familiar altcoins but to new and fresh projects. One of them is the FTX token (FTT), an internal asset of the FTX crypto exchange.
But what is this token, and why does it attract so much attention? And most importantly: is it a good investment in the current market conditions?
What is the FTX (FTT) Token?
FTX (FTT) is a digital asset and the internal token of the FTX cryptocurrency exchange, introduced in 2019 shortly after the launch of the exchange. The FTT token is based on Ethereum and is compatible with all wallets and exchanges that support ERC-20 tokens.
The token is developed by FTX co-founders Sam Benkman-Fried and Geri Weng and is backed by Almeda Research, one of the largest liquidity providers and leading companies in crypto trading.
The total reported supply of ftt crypto tokens is around 340,000,000, and the current supply is over 127,000,000 FTT. The FTX exchange spends a third of all the fees received from the purchase and burning the FTX token until half of the total amount is destroyed.
FTX was not the first to create internal tokens. This is a fairly common trend at the moment. Other crypto exchanges are also launching their digital assets, such as WBT (WhiteBIT), CEX (Binance), and DEX (Uniswap).
At the same time, the FTX token should not be compared with the internal coins of other exchanges, for example, Binance Coin (BNB). The FTX exchange is a very peculiar cryptocurrency market. The founders of FTX focused on providing unique tools for the most demanding retail and institutional investors. FTT is considered to be aimed at this niche and does not try to compete with other domestic tokens (BNB, UNI).
What is the FTX exchange?
FTX considers itself as a new generation exchange meant to be a solution for the most demanding investors whose needs cannot be met by traditional cryptocurrency exchanges.
The founders of the FTX exchange are Gary Wang and Sam Bankman-Fried. Before launching the platform in 2019, Wang and Bankman-Fried had years of trading experience and worked for tech giants such as Facebook and Google.
The authors call their offspring a response to the significant shortcomings they found on other exchanges: the lack of trading tools, mechanisms for liquidating open trading positions, liquidity, etc.
One of the most interesting features of the exchange is the option to invest in leveraged tokens. Using FTT, users can invest in tokenized versions of cryptocurrencies with significant leverage. Largely due to such unique characteristics and FTX’s status as one of the most popular platforms in the world, FTT was in the category of good investments for a long time.
In addition to a set of tools, typical for cryptocurrency exchanges, FTT has implemented instruments to optimize the buying and selling digital assets. These included product listing, margin maintenance, liquidation processes, and collateral solutions.
FTT price analysis
FTT’s history has been on the rather positive side up to the events of November 2022. With FTT’s strong technical foundation and industry-relevant use cases, it makes sense that FTT was at some point one of the top cryptocurrencies during periods of price growth.
For quite a long time, the token price remained at about $4. In January 2021, FTT began to grow rapidly, and on September 9, 2021, it reached an all-time high of $85.02.
By the way, at its peak, the FTT token became very profitable for investors. The maximum growth since the launch in 2019 was 5495%, which made FTT an altcoin with one of the highest levels of return on investment.
The FTT price crashed in November 2022 and at the moment of writing this article reaches only $5.48. At the same time, some experts believe that FTT has enough growth potential.
Is FTT a good investment?
Cryptocurrencies are inherently unstable. There is no certain answer about the prospects of a particular cryptocurrency. At the same time, FTT has been showing stable growth from the beginning, which definitely attracted investors. However, after the latest controversies, people are not so sure about it anymore.
Considering all the factors above, we can assume that FTT, due to its uniqueness, has the potential to become a good investment.
When thinking about investing in any cryptocurrency, you should never forget about such a key feature of the crypto as high volatility on any cryptocurrency marketplaces. Before making an investment decision, you must conduct your own research about each particular cryptocurrency and the market as a whole. The investment decision should be your personal decision.