If you want more cryptocurrency analysis, including full-length research reports, trading signals, and social media sentiment analysis, use the code "Publish0x" when subscribing to CryptoEQ.io to make your first month of CryptoEQ just $10! Or simply click the button above!

FTT Strengths

• Clear benefits for power users of the FTX, one of the biggest and most powerful businesses and brands in the crypto universe
• Clear and simple ERC-20 design means very little technical risk
• World-class team and investors behind FTX and the FTT token
• Minimal slippage for BTC/USD(T) pairs, around 0.01%.
• Diverse product offering.
• Very low trading fees.
• FTX.US has opened stock and ETF trading in all 50 US states.

FTT Weaknesses

• Fully centralized around FTX exchange and wholly reliant on the exchange's success. 
• Lack of community with only ~29,284 FTT addresses and less than ~229 active users.
• FTX website currently states FTT is not available in the U.S. or other prohibited jurisdictions, and U.S. users are not permitted to transact in FTT.
• FTT is ideal for high-frequency traders and large active accounts, not most retail traders.

FTT’s development can be seen on Github; however, there are no contributors nor commits yet in 2022. This illustrates that while the project may be stable (a simple ERC-20 token), it’s not being worked on, and there are currently no plans to innovate its design. There are zero open and closed issues.

An audit for FTT was done by Blockchain Consilium, and the report can be accessed here; no high or moderate-severity issues were found. FTX has successfully undergone a U.S. GAAP financial audit for 2020 and plans to continue undergoing regular audits.

FTX fully supports the FTT blockchain development with significant funding and team resources. Because FTT is controlled by a private, for-profit company, many of the challenges inherent in decentralized blockchains aren’t relevant to FTT. There’s no argument that FTT users incur extreme centralization risk when holding FTT. FTT’s future is ultimately tied to FTX’s success as a profitable company and navigating global regulatory risk. With a large portion of FTT either owned or custodied by FTX (~47.8 million FTT), the potential catastrophic downside risk for the token becomes even greater. Exchange hacks are an ever-constant threat, as are failed crypto businesses. The FTT token is exposed to both of these (regular) downside events, unlike a traditional cryptocurrency like Bitcoin or Ethereum.

*Read more about the FTT token here or the difference between FTT and BNB here!*

Regulatory Risks

Exchange discount tokens could be considered equity in the exchange and viewed as securities which would give the SEC jurisdiction over them. They could also ban U.S. customers from transacting with them. FTX US and Binance US could end up having very limited pair offerings if clear crypto securities definitions are crafted. FTT is already banned in the U.S., and BNB could suffer the same fate.

There are regulatory challenges to the adoption of the FTT token, especially in the U.S. The FTX website currently states FTT is not available in the U.S. or other prohibited jurisdictions, and U.S. users are not permitted to transact in FTT.

While FTX is known for working closely with regulators, it remains to be seen what impact regulatory concerns have on the future of FTT.