Arbitrage trading intensified after FTX’s liquidation, with analysts attributing the decline in altcoin prices to a token arbitrage mechanism. During FTX’s bankruptcy, large SOL positions were sold at discounts exceeding 60% under “pay first, deliver later” arrangements. Hedge funds hedged risk in futures markets, combining staking and basis yields to achieve returns of 70%–80%. The strategy spread as teams sold locked tokens, transferring pressure into derivatives markets. Retail investors now