May 24, 2024

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Skepticism about crypto is growing at the top of the US

Skepticism about crypto is growing at the top of the US

It’s only been 10 months since Sam Bankman-Fried appeared before the US Senate to promote his FTX. According to the fallen CEO, the technology behind FTX was able to dramatically improve the traditional financial system.

Decision of banks

According to Bankman-Fried, the FTX platform’s software can take over various processes from banks. For example, the scammer mentioned that the client trades are automatically liquidated once the positions turn negative. Another advantage is that the collateral for the positions must be kept “on the platform” so that FTX always has access to the assets.

What he didn’t say at the time was that Alameda Research had special privileges on the platform and didn’t require a network to perform certain actions. It is also now known that Alameda Research even used a network of clients to carry out activities. Ultimately, this caused a billion-dollar crisis for FTX and Alameda Research.

The Asking this week However it had a completely different tone. “Clearly, FTX’s problems arose primarily because of crypto’s unique ability to create assets out of thin air,” said Hilary J. Alan said.

Criticism is great

In the end, FTX’s downfall is definitely the result of fraud and has nothing to do with Bitcoin or any other crypto in principle. In particular, it makes clear that stock markets need tighter rules to prevent this in the future. In principle, a traditional equity platform could also choose to gamble its clients’ shares, but they don’t because of the consequences.

Sam Bankman Roast And his club of cheaters didn’t care about that and thought they were too smart. Much smarter than the rest of the market, which is usually absent and turned out not to be this time. “Just as you cannot create government without government or religion without religion, you cannot create faithless money. The appropriate words for this are anarchy and cult,” said actor Ben McKenzie, who is currently writing a book on crypto.

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FTX Interim CEO John Ray says it’s clear what went wrong on the exchange platform. “The collapse of the FTX group stems from the absolute concentration of power in the hands of a small group of inexperienced and unsophisticated individuals,” Ray said.