FTX Token hits new record up 50% so far in September — What's driving FTT price higher?
FTX crypto exchange's native utility token FTT reached a new record high on Sep. 6 a week after it agreed to acquire LedgerX, a United States-based crypto derivative platform, for an undisclosed sum.
On Monday, the FTT/USD exchange rate surged 16.37% to $73.99 in a market-wide rally that saw other top coins post similar but dwarfed price rallies. Additionally, the pair's intraday climb coincided with gains among top exchange tokens, with Binance's BNB rising 2.3% and Uniswap's UNI recording 3.5% profits on a 24-hour adjusted timeframe.
The 24-hour performance of the top 10 crypto exchange tokens. Source: MessariLedgerX acquisition
The news of the FTX's Ledger acquisition served as the primary bullish backdrop behind FTT's rally.
On Aug. 31, the crypto exchange revealed that it wants to offer a wide array of crypto-based asset classes in the U.S. via its regional wing, FTX.US. As a result, their acquisition of LedgerX, a U.S.-regulated crypto derivatives exchange and clearinghouse for retail and institutional investors, would mean a broader market exposure for FTX services.
FTT jumped 34.42% in response to the LedgerX news on Sep. 1. Later, the cryptocurrency entered a consolidation phase, only to resume its uptrend Monday, rising up to 16.37%. In total, its month-to-date gains came out to be a little over 50%.
FTT/USD four-hour price chart. Source: TradingView.comFTX Bitcoin OI already near previous record high
In detail, FTT provides its holders an opportunity to earn trading fee discounts and over-the-counter rebates on the FTX exchange. The token holders can also use FTT as collateral for futures positions. Meanwhile, institutions that want to buy a white label version of FTX's OTC portal and futures exchange can do so by using FTT.
Therefore, FTX's network growth tends to directly correlate with FTT's price performance. The relationship was visible in the recent rally, as the Bitcoin Futures Open Interest on the FTX exchange recovered to $2.96 billion on Monday. At its highest, the OI was $3.02 billion on April 13, 2021.
FTX BTC Futures Open Interest. Source: ByBt.comAdditionally, FTX's Bitcoin OI recovered towards its all-time highs faster than any other crypto derivatives exchange. For instance, Binance's Bitcoin OI reached $4.83 billion, with its best level at $5.27 billion, per data provided by ByBt.com.
Technical outlook
FTT's latest bull run has pushed it into a price discovery mode.
FTT/USD daily price chart. Source: TradingView.comThe FTT/USD rate underwent a 6% correction after topping out at $73.99 on Monday, signaling profit-taking among daytraders.
Related: Expanding ecosystem and LedgerX acquisition send FTX Token (FTT) to a new ATH
Now, the pair looks at maintaining support near $61.03 to retest its current all-time high for a bullish breakout. Should it happen, the next resistance target will appear at roughly $85, as per the Fibonacci retracement setup in the chart above.
Meanwhile, a continued sell-off would risk pushing FTT/USD to around $52.48, a level also near the 20-day exponential moving average (20-day EMA; the green wave).
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