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Analyst firm Chainalysis compared the collapse of FTX to the decline of Mt.Gox to determine how FTX’s bankruptcy would affect the ecosystem. According to Chainalysis, FTX’s bankruptcy is likely to have relatively less impact on the crypto ecosystem than Mt.Gox’s collapse.
Analysts concluded that FTX was a relatively smaller part of the crypto industry than Mt.Gox was at the time, and that the industry should recover faster than ever.
In a Nov. 23 Twitter thread, Chainalysis lead researcher Eric Jardine began his research by comparing the market share of the two firms, finding that Mt Gox averaged 46% of all exchange flows in the year leading up to its collapse in 2014, compared to FTX’s average share of 13% over the 2019 to 2022 period.
Jardine notes that in 2014, when Mt.Gox collapsed, centralized exchanges (CEX) were the only major players in the industry, while in late 2022, nearly half of all exchange inflows were captured by decentralized exchanges (DEX) like Uniswap and Curve.
Jardine believes that while there are other factors, such as Sam Bankman-Fried’s extensive public presence, “the comparison should instill optimism in the industry,” because when it comes down to market fundamentals. There’s no reason to think the industry can’t recover from this by becoming stronger than ever.
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