https://www.nasdaq.com/articles/everything-you-need-to-know-about-the-ftx-meltdown
Precursor : please read linked article and form your own opinion first ok. Thanks.
Certainly by now, every investor would have come across news on FTX - World's ex-2nd largest crypto exchange.
The news article managed to successfully provide a "personal", yet "objective" overview of how the entire saga unfolded.
In addition, if sufficient news articles are read - some will become the missing pieces; that will eventually completes this "Huge" jig-saw mess that is still unravelling; even as I composed.
Simply put this is a case of a brilliant person becoming "too smart" for his & her own good.
Like all "inspiring" success stories (Facebook, Apple); it had always, always started small & in many ways idealistic.
However as the pet project grow & grow & grow - the original do good, do well fades into the background as wealth, fame, greed and power comes knocking.
A characteristically-weak person like FTX's creator mr sam bankman-fried (SBF) will lose himself overtime with his four new found "friends".
How could he not have set himself up to "fail" ?
- He was young; when he became "successful".
- He had support from the Crypto community. CZ - Binance's creator became his friend and supported him (early on i guessed) by taking a stake in FTX early on.
- His two rounds of successful funds raisings from venture capital and hedge funds amounting to US$1.3 Billion emboldened him
Guessed he "changed" overtime and became "reckless, careless & callous" in the process.
Perhaps he also became greedy and anxious to want to be the #1 Crypto Exchange immediately as well - who knows right ?
Mixing business with politics ??
Political manoeuvre in-progress ?
https://cryptopotato.com/sam-bankman-fried-conspired-with-sec-for-special-treatment-us-congressman/#aoh=16693042683747&csi=0&referrer=https%3A%2F%2Fwww.google.com&_tf=From%20%251%24s&share=https%3A%2F%2Fcryptopotato.com%2Fsam-bankman-fried-conspired-with-sec-for-special-treatment-us-congressman%2F
Above information (1) from Wikipedia and (2) from Cryptopotato were clues (maybe ??) of SBF making a politically tactical move to position FTX ?
Is this the undercurrent tussle between him and CZ of Binance that led to CZ's immediate dumping of his US$2 Billion worth of FTT tokens ? {mentioned in linked document}
Has SBF underestimated the clout Binance wields and Changpeng Zhao (CZ) wields ?
Most definitely on hindsight now, no ? Likely, his strings of successful funds raised have clouded his judgement and fuelled his greed.
What else is there to learn ?
As the FTX saga unfolds before our eyes, the observations I gathered (maybe wrong!) is that there seems to be too much of inter-trades or inter-investments within the crypto community.
Could this be the reason why when any one crypto establishment was shakened, there would be a domino-effect that reverberates through the community ?
$15 Million is minimal exposure ??
- Aug 2020, FTX acquired Blockfolio, a cryptocurrency portfolio tracking app
- Jul 2022, FTX finalized a deal giving it the option to buy BlockFi for about $240 million; with a $400 million credit facility.
- Sep 2022, FTX.US won its bid at auction for digital assets of bankrupt crypto brokerage Voyager Digital
- Ambiguous relationship amongst FTX, FTX.US and Alameda Research.
Conclusion - too optimistic ?
I didn't like the optimistic ending of the article. It has glossed over the massive losses suffered by the myraids of retail investors who in a moment of weakness (blinded by greed or ignorance ?) got sucked into this blackhole.
Is there really light at the end of the tunnel ?
To find out, please read below article as well please ! https://www.theguardian.com/commentisfree/2022/nov/23/ftx-binance-crypto-market
Are you convinced or are you still a Crypto believer ? Now confess in the Comments section below ? Whahhha... joking.. still would like to know what you think ? Thanks.
Please "Like" this post ok. Thanks. Rating is important to me... Thank thanks.
Matching song ? Nothing Last Forever by Echo and The Bunnymen. Dunno ? YouTube it..
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