Visible progress in the cryptocurrency space follows price trends, and boom cycles bring new exchange innovation. While the FTX exchange launched in 2019, it gained considerable prominence as the market spiked in mid-2021. While the cryptocurrency exchange market may appear saturated with dozens of high-profile exchanges, the “Wild West” nature of the industry makes it difficult to gain trust. High-profile exchange collapses and grifts still occur with some regularity, resulting in user apprehension when approaching untested exchanges.
FTX overcame this problem and grew rapidly to major competitor status, seizing a top three spot for derivatives exchanges globally. In stark contrast to their direct competition, FTX appears to have threaded the regulatory needle and avoided the intense pressure currently facing Binance. Their native currency, FTT, grew by a factor of 25 over the previous year – currently sitting at $70 per token. In part, their recent success derives from an all-out media blitz focused on sheer, recognizable star power.
In a tactic pulled straight from traditional retailers, FTX enlisted a variety of celebrities as “FTX Brand Ambassadors.” Pulled from major league sports, international modeling, and the finance world, these brand ambassadors help the crypto-exchange get its name out in front of the average person. Mere days after announcing his interest in cryptocurrency, basketball player Stephen Curry announced his new partnership with FTX.
Beyond individual ambassadors, the cryptocurrency exchange also made a deal with Major League Baseball to place an FTX patch on every umpire uniform. These efforts contrast sharply with other cryptocurrency businesses – most of which focus on attracting users from within the current ecosystem. As the learning curve blunts, new investors may respond well to familiar faces and choose FTX over other exchanges.
Is FTX the 2021 Version of Binance?
Binance famously hit the ground running in 2017 during the previous bull run that saw BTC hit $20k for the first time. In the prolonged crypto-winter after 2018’s crash, Binance consolidated its gains and became the de-facto exchange of choice for much of the cryptocurrency community. Recently, the tide turned against Binance as regulatory agencies circled, taking bites at their more questionable products.
FTX’s foundation may better stand the test of time, having produced FTX.us before regulatory pressure. Further, they’ve dialed back their leverage offerings to mitigate investor risk. Recently, they’ve started allowing users to mint NFTs within the exchange. Whether they can topple Binance remains to be seen.