Bybit Unveils $100M Support Fund For Institutional Traders
Institutional trading companies have faced lots of financial losses and operational challenges in the wake of the FTX collapse.
Crypto derivatives exchange Bybit has unveiled a new support fund to assist institutional traders in accessing liquidity in the wake of the FTX collapse – an event that mainly triggered a new wave of panic selling across the digital asset space.
The support fund, valued at $100 million, is available to market makers and high-frequency trading institutions that are now struggling with financial or operational challenges after the collapse of FTX earlier this month. Bybit confirmed this information on November 24. The new funds will get distributed to eligible applicants at a 0% interest rate.
To qualify, institutional traders need to be active on Bybit or other exchanges. The maximum amount distributed per applicant is $10 million and the funds have to be used for spot and Tether (USDT) perpetual trading on Bybit.
Once the second-biggest crypto exchange in the world, FTX filed for Chapter 11 bankruptcy on November 11 after a coordinated bank run exposed the company for being insolvent. A scandal followed quickly after it became clear that CEO Sam Bankman-Fried was comingling funds between FTX and sister firm Alameda Research, which eventually resulted in an $8 billion hole in FTX’s balance sheet.
Notably, FTX’s 50 biggest creditors are owed over $3 billion. Many of the firms exposed to FTX have reported financial and liquidity crises because of its collapse. Bitcoin lender BlockFi is now considering bankruptcy, while the Digital Currency Group-backed Genesis Global Trading recently stopped new loan originations.
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