The atmosphere of general distrust is to be expected due to the sheer scale of the FTX collapse. It was a piece of very bad PR for the whole crypto industry, but many crypto exchanges are doing well.
While we have seen many bankruptcies this year as the crypto market plunged down by 70% since May, the industry is mature enough to stay strong.
Nations are stepping up their regulation game, meaning that authorities strongly believe that the industry will survive and flourish. However, we still need to get through the “winter”.
Financial experts think that CEX platforms will do just fine
The biggest focus of the news cycle was Binance which saw a massive $1.9 billion 24-hour withdrawal wave sending a warning sign to investors.
However, the next day brought recovery, and the exchange reported an $807 million net positive deposit inflow. The only hiccup during the last week was the problem with USDC withdrawals which was sorted out quickly.
Omid Malekan, a professor at Columbia State, is a respected expert in the crypto field, and he said that Binance managed to keep its assets liquid.
He suggested that if all users of the platform decided to take Bitcoin off, they would be able to do that without any issues. Whether the same can be said about other centralized exchanges that saw massive withdrawals is a different question.
Joshua Peck, an expert on crypto risks, said that the community is testing these exchanges. It is the most important period in the history of the industry as the biggest companies are being checked by retail traders.
If Binance and others survive this era of FUD, they will flourish during the next bull run. So far, Binance has been repelling all attacks from the media and managed to stay strong despite living through what seemed like a bank run.
The consensus among experts
The general idea of what is happening and will happen to the crypto industry is that it will weather the storm just fine.
Investors are afraid of putting their capital in something risky and will keep their distance from crypto for a while. However, it is a great opportunity to restructure and come back at the beginning of the next year.