Despite FTX’s Collapse, FTT’s $535M Market Cap Highlights Crypto Absurdity

Ten days ago, the FTX estate overseeing the bankrupt company’s proceedings informed customers they would receive more than 100% repayment. Following this announcement, the exchange token FTT from the defunct trading platform rose above $2 per unit. Astonishingly, despite being tied to a failed crypto exchange, this token still holds a market valuation of $535 million, which is baffling given its lack of underlying value.

Dead Coins Keep Walking

FTT continues to trade on several exchange platforms, despite being a creation of FTX, a crypto exchange notorious for its fraudulent activities. FTX’s CEO, Sam Bankman-Fried, was convicted and sentenced to nearly 25 years for his role in the fraud. It is well known that FTT played a significant part in enabling FTX’s misconduct alongside contributing to the company’s downfall due to its extensive exposure to the token.

While FTT’s market cap is $535 million today, on Sept. 9, 2021, it reached as high as $9.75 billion.

Yet, despite the token contributing to market manipulation and deceptive financial strategies, it is still trading for $1.63. On top of the fraud, FTT is highly centralized among its holders. The FTX estate controls 69.06% of the total supply, while Binance holds 9.51%. Despite having 30,384 owners, the top ten largest FTT wallets possess a staggering 87.85% of the entire supply. Even before this distribution, FTT’s tokenomics were dubious, resembling a pyramid scheme.

FTT’s distribution is comical, to say the least, and worsened significantly when the contract deployer unlocked the remaining locked supply. The token’s fully diluted market cap stands at an absurd $535 million because the contract deployer associated with the so-called ‘locked funds’ dumped all remaining FTT tokens into circulation. Beyond its initial use within the FTX ecosystem, FTT is practically worthless, lacking any real-world utility and making it a significantly unattractive investment compared to other cryptocurrencies.

Nonetheless, some people might still invest in it, including speculators, high-risk traders, and hopeful investors betting that FTX’s bankruptcy proceedings and potential restructuring could somehow boost the token’s value. Amusingly, even Celsius Network’s CEL token holds a value of $0.61 per unit, and Voyager’s VGX is trading at $0.078. For years, numerous crypto projects have collapsed, yet inexplicably, the coins associated with these projects persist, despite having no development or remaining use cases.

What do you think about dead coins like FTT continuing to survive despite having no real use case and being born from fraud? Share your thoughts and opinions about this subject in the comments section below.