Bybit launches US$100M fund to support institutional clients
Singapore-based crypto exchange Bybit announced the launch of a new support fund for institutional traders in the wake of the FTX collapse which saw at least $1 billion FTX customer funds vanish.
In a Nov. 24 blog post, Bybit said its platform’s traders are eligible to access as much as US$ 10 million and the funds must be used for spot and USDT perpetual trading on Bybit.
Bybit’s announcement follows the FTX collapse that triggered a cascade in the price of the crypto market and the downfall of many institutional traders and firms. The debacle started when FTX, founded by Sam Bankman-Fried (SBF), was exposed for lending customer assets to its sister company, Alameda Research, for risky trades. At the same time, SBF was also issuing FTT tokens for Alameda to use as collateral.
After the news broke, Binance announced plans to sell all their FTT holdings worth more than US$500 million. This sparked a mass selloff amongst FTX users, causing FTX to lose all liquidity and failure to meet customer withdrawals.
On Nov. 14, an insider hack saw US$600 worth of cryptocurrency drained from the FTX platform. On the same day, FTX, Alameda Research and around 130 firms with exposure to FTX filed for bankruptcy. These institutions include Ontario Teachers' Pension Plan , the Washington State Investment Board, other investors via Sequoia Capital, and other venture capital firms. Since then, the crypto market has lost two-thirds of its value.
In similar news, Binance also launched a US$1 billion ‘industry recovery fund’ to support projects who are suffering a liquidity crisis in the wake of the FTX collapse on Nov. 10.