FTX is one the major leader in the trusted platforms for crypto exchange worth 32 billion. On 11th Nov 2022 FTX filed for bankruptcy protection, Sam Bankman Fried (SBF) steps down as CEO as a statement posted on Twitter but he would help through the transition. SBF’s wealth is worth 15.6 billion with his major assets and stake in FTX now have become zero. SBF with a positive attitude assured that the best alternative with FTX is to access this situation and will effectively process to maximize recoveries of the funds for the stakeholders. The unsteady assurance and the desperate race to raise money. The conflicting rivalry with Changpeng Zhao (CZ) and Binance, threw FTX a lifeline only to take a step back a day later. CZ, tweeted about his exchange was liquidating its holdings of FTT, worth more than $500 million. That optimism turned the tables as the FTT token entered an 80% freefall over the next 24 hours. Sam Bankman Fried’s digital-asset exchange FTX was hit by a mysterious outflow of about $662 million in tokens in the past 24 hours, the latest twist in one of the darkest periods for the crypto industry. Before the world began to grasp the truth about Sam Bankman-Fried, an inkling of doom began to spread through his convoluted crypto empire. It’s unclear exactly who’s making the transactions, but we as an investor wouldn’t expect to see these on-chain trades at this time These recent developments have given the industry, which was already reeling from the crypto rout that started with the crash of Terra and Luna in May, a jolt. Two events accelerated the fall: 1. CoinDesk report on Alameda’s balance sheet on November 2. 2. Binance founder Changpeng Zhao tweeted about liquidating FTX token FTT on November 6. On November 2, CoinDesk published a report that Alameda’s single-biggest asset was FTT, accounting for about $3.66 billion of the total $14.6 billion asset in the balance sheet. It also had $2.16 billion FTT as collateral. This may have caused a liquidity crunch for the market giant. FTX had allotted its customer’s assets as self-issued collateral to Alameda (FTX quantitative trading firm) in return for FTT (FTX Token) if FTT falls then it would destabilize FTX. In July 2021, SBF paid USD2.1 billion for Binance’s stake in the company in FTT and BUSD (Binance’s native token). Is it a fraud or a strategic step for the company? Regulators and authorities are taking major action to track SBF and get to the bottom of the situation. Thank you.
Well articulated 👏👏
ReplyDelete