Crypto Frontline

United States – FTX’s founder, Sam Bankman-Fried, sends shocks through cryptocurrency after the recent crisis that FTX experienced, especially when Binance didn’t proceed with its acquisition. 

Sam Bankman-Fried, the founder of FTX, got many recognitions as he quickly attained superstar status as the head of the digital asset exchange FTX. Some called him the savior of digital assets, the newest energy in Democratic politics, and possibly the first trillionaire in the world. However, everything changed after the crisis of FTX. 

Now, the comments about the founder varied from mystified to aggressive after filing the bankruptcy protection for FTX. The action left customers and investors feeling conned, and the rest of the cryptocurrency traders in the industry feared the repercussions of bankruptcy. Bankman-Fried might even face criminal or civil charges. 

Jeremy Allaire, Circle’s co-founder, and CEO, said that he knew Bankman-Fried for a couple of years, and what happened with FTX left him in shock. 

FTX rapidly grew under the management of Bankman-Fried, where it became the third-biggest crypto exchange by volume. The amazing collapse of the emerging empire sent big waves through the digital asset industry. It was part of a share of instability and turmoil this 2022, including a sharp drop in price for BTC, Bitcoin, and other cryptocurrencies. The events were similar to the domino-like disaster of Wall Street companies in the financial crisis back in 2008. Now, wholesome firms fall, like FTX. 

One business capital fund wrote down investments totaling $200 million in FTX. BlockFi, the crypto lender, stopped customer withdrawals after the bankruptcy protection of FTX. Crypto.com, a Singapore-based crypto exchange, witnessed an increase in withdrawals this weekend for inside reasons. However, some of the action might be credited to crude guts from FTX. 

Sean Ryan Evans from Bankless, a cryptocurrency podcast, tweeted about the bankruptcy filing, questioning the founder about his actions. 

Bankman-Fried and FTX are under investigation by the SEC or Securities and Exchange Commission and Department of Justice. The investigations will center on the probability that the company used the deposits of customers to fund the hedge fund of the founder, Alameda Research, and that this transaction was a breach of the securities law in the United States or the US. 

Patrick Hillman, Binance’s chief strategy officer, stated that it’s the immediate result of a rascal actor cracking every basic rule of economic responsibility. 

The impact of the bankruptcy of FTX is uncertain. Yet, its failure will damage billions of dollars and more uncertainty for digital assets when the industry could use the support of confidence.