Crypto Graveyard: FTX and FTT
2026-09-10
FTT peaked near $84-85 in September 2021, then went to near zero in November 2022 as FTX imploded. The exchange that ran Super Bowl ads was insolvent within days of scrutiny.
| Fact | Detail |
|---|---|
| Token | FTT, FTX exchange token |
| All-time high | About $84-85, September 2021 |
| Drawdown | Effectively 100 percent to near zero, November 2022 |
| Trigger | CoinDesk Alameda balance-sheet report, 2 November 2022 |
| Collapse | Binance FTT liquidation, withdrawals halted, Chapter 11 on 11 November 2022 |
| Aftermath | About $8B customer-funds shortfall; SBF convicted, 25-year sentence |
Cause of Death
Fraud and misuse of customer funds, amplified by an exchange-token collateral loop. FTX customer deposits were routed to affiliated Alameda Research, which held large amounts of self-issued FTT as collateral. When CoinDesk revealed Alameda's balance sheet rested on FTT, confidence broke, Binance announced FTT liquidation, and the token and the exchange fell together.
Red Flags
An opaque affiliated market maker holding its own exchange token was the central warning. No proof of segregated customer funds, related-party loans, and a token whose value underpinned the group's solvency meant one price drop could sink everything. Fast withdrawals freezing is the classic insolvency tell.
Lesson
Discount exchange tokens as collateral and demand proof of reserves plus independent custody. If an exchange's solvency depends on the price of its own token, treat deposits as unsecured loans to a hedge fund.
More in this series: Crypto Graveyard hub, Terra LUNA UST, Celsius CEL, Classic Ponzis, Squid Game Rug, Hawk Tuah, Libra Argentina, Laptop Rugpull Caution.
Further reading: CoinDesk on the Alameda balance sheet, Reuters on the FTX crash, DOJ on the SBF sentencing.
Not financial advice. Sources checked: 10 September 2026.