The FTX Token has bounced back in the past few days even as the plot thickened for Sam Bankman-Fried (SBF). FTT rose to a high of $1.038, which was about 23% above the lowest level on Thursday. So, what next for the FTX Token?
Sam Bankman-Fried’s downfall continues
The biggest story of the week was the continued downfall of Sam Bankman-Fried (SBF), the founder of FTX. On Wednesday, his two senior-most officials in his empire pleaded guilty on charges brought by American regulators. They also decided to become prosecution witnesses.
A day later, SBF landed in the United States from the Bahamas. In his first day of appearance, Bankman was given a $250 million bond secured by his family home in California. He will also go through a mental wellness evaluation and wear a GPS device.
The events of the past few weeks have marked one of the biggest downfalls in the financial industry. And the worse is yet to happen. Analysts expect that Sam Bankman will be jailed for more than 20 years. Combined, the crimes he has been accused of carry a maximum of over 100 years.
It is unclear why the FTX token has rallied by more than 20% in the past 24 hours. A likely reason is that the token has now become a meme coin. Besides, FTX has already collapsed and the possibility of it coming back to life are minimal.
Unlike companies like Voyager Digital, there is minimal possibility that any company will want to acquire the company out of bankruptcy. For one, recent revelations have showed that the company was poorly managed and used QuickBooks for accounting.
Is FTX Token a good buy?
The FTX Token has done well in the past few days. However, it is still impossible to recommend it as a solid investment. For one, it has no real value considering that the parent company has gone bankrupt.
Further, FTT is a highly illiquid token that is thinly traded. As such, this brings the risk of being a pump-and-dump token.
Turning to the two-hour chart, we see that the FTX token made a strong rebound recently. As it rose, it moved above the 25-day and 50-day moving averages. The Relative Strength Index (RSI) moved above the neutral point.
Therefore, there is a likelihood that the FTT price will resume the bearish trend as sellers target the all-time low of $0.800.
