In the last month of the outgoing year, the world witnessed one of the gravest losses of all time in the crypto trading industry. FTX, one of the largest cryptocurrency companies in the U.S., saw a loss of $30 billion following just a tweet.
The Tweet came from Binance, another crypto giant in the country, saying that the company will no more acquire FTX – or shares of it. ) by the end of 2022. But things did not go well for Binance, as the Tweet highlighted.
That is why Binance decided to withdraw the agreement that it had made with FTX earlier in 2021. As a result, FTX collapsed losing $30 billion in just two days. The company, later on, was declared bankrupt.
Following the fall of FTX, the CEO of the crypto firm, Sam Bankman-Fried was arrested soon after he tweeted “I messed up.” The ex-FTX boss was alleged of bankruptcy and many other allegations were made against him. Among the allegations against Sam Bankman-Fried, the collapse of FTX was the leading one.
At the time of Sam Bankman-Fried’s arrest, the court ruled that the ex-FTX CEO owed $15 billion to crypto traders. These were FTX customers and Sam’s partners in the cryptocurrency industry. However, it is essential to note here that Sam Bankman-Fried is still under arrest and the release of the FTX boss is not yet clear.
So, one reckons we are not talking about a usual loss of a mere crypto trader here. Instead, the ex-FTX boss is one of the richest folks in the United States, And his crypto empire (FTX) was one of the leading crypto empires in the country.
So, this makes us wonder about the ludicrous nature of crypto loss of all time. Sure enough! Cryptocurrency is smart digital money. And the CEO of FTX, Sam Bankman-Fried, is one of the most experienced entrepreneurs of our time. With all that, how on earth so much smart money was lost in a blink of an eye?
Ridiculous as the fall of FTX sounds, its shareholder is equally part of this grave loss, Critics scoff at investors who invested in an “insecure” platform like FTX. How do investors put their “smart money” into FTX without fathoming the risk factor that comes with it, critics ask.
They are of the view that the investment idea was put forward by a millionaire and a crypto playboy, and investors did not think about the risk factor. And fairly so, they felt the aftershocks of their ill decision.
According to Yahoo Finance, giant investors have invested a staggering amount of $1.9 billion in the last three years. And today, as FTX collapses, the ex-FTX boss owes this staggering amount of money to FTX shareholders. But will the opulent CEO be able to pay off this massive amount? Nobody knows. Ironically, the investors do not know it either.