The collapse of the 30-year-old Sam Bankman-Fried’s empire alone deprived millions of people of considerable funds, and the fall of the FTX cryptocurrency exchange siphoned hundreds of millions of dollars from the entire cryptocurrency market. Important institutions, especially in the United States and the European Union, have been observing the situation from afar and will now start pressing for the final determination of the rules for crypto-assets, according to the Bloomberg agency.
Up to 24 percent. This was the market capitalization decline of the entire cryptocurrency market between November 8 and November 10, when the difficulties of the FTX cryptocurrency exchange were at their peak, for whose bailout even the largest cryptocurrency exchange and FTX’s main competitor Binance refused to fight. According to data from TradingView, the overall value of the cryptocurrency market has plummeted since $1.05 trillion at the $750 billion level. This took the cryptocurrency to its lowest level since December 2020.
The crash was not only influenced by unknown and highly speculative cryptocurrencies, but also on the two main cryptoassets, namely Bitcoin and Etherwhich wiped out about 20 percent of the value.
According to Bloomberg, the situation is monitored by the main American and European institutions which have long criticized cryptocurrencies for the absence of functional regulation of the cryptocurrency market.
Cryptocurrency exchange FTX has gone bankrupt. The digital currency market is experiencing the biggest crash in history
Financially struggling cryptocurrency exchange FTX has filed for bankruptcy in the US and will seek judicial protection from creditors. The company announced it on Twitter. Its CEO Sam Bankman-Fried steps down from his post. The Cyprus Securities and Exchange Commission announced shortly after that it had suspended the company’s license to operate in the European Union to protect investors. The FTX crash could therefore be one of the biggest in the cryptocurrency industry.
“The US government is monitoring this situation and reiterates that Americans risk losing all their invested money if they put it into a system that lacks all the rules,” Bloomberg said, citing a senior government official on condition of anonymity. According to Bloomberg, the event will likely lead to further attempts to provide a clear framework and rules to the cryptocurrency market.
The most embarrassing moment in the history of cryptocurrencies
However, the absence of rules is only partial. The cryptocurrency market itself operates without rules, however some cryptocurrency exchanges such as Binance and FTX have become part of the global investor establishment. Binance is on the stock exchange, it must report the mandatory data of the operation. FTX had a commercial license for both the US and the European Union. This is why the US Securities and Exchange Commission is now investigating whether there has been any unfair behavior at FTX.
Shortly before FTX filed for creditor protection against itself in the US, assets worth at least $662 million disappeared from users’ crypto wallets. According to Bloomberg, a hacker attack may be behind this leak.
Twilight on cryptocurrency exchange FTX in Europe. He lost his license, his currency is down ten percent
Cypriot regulator has suspended cryptocurrency exchange FTX’s license to operate in the EU. Citing sources from the Bloomberg agency, CoinDesk and other media reports about it. The company, which was in financial difficulty, only received its license two months ago. Meanwhile, the Bahamian regulator has frozen some of the exchange’s assets. The FTX woes have caused the entire industry to plunge sharply in recent days, with Bitcoin recovering from a two-year low.
“If it is confirmed that these were indeed hackers, it will be just one more reason in what can already be described as one of the most embarrassing crypto-communists to ever face,” Bloomberg reported.
Who is Sam Bankman-Fried?
Why the most shameful? Exchanges like Binance or FTX were supposed to be the tool that would help give cryptocurrencies legitimacy in the eyes of all investors. These exchanges wanted to act like standard trading companies, they wanted to avoid all the previous problems.
Sam Bankman-Fried founded the cryptocurrency derivatives exchange FTX in April 2019. The 27-year-old MIT graduate quickly became a star in the business world. As the value of cryptocurrencies has grown, so has his fortune, which according to Bloomberg has reached $26 billion. His fortune is down to about $16 billion this year.
The panic on the cryptocurrency market continues for the third day, Bitcoin drops to 13 thousand dollars
Cryptocurrencies weakened significantly for the third day in a row. Cryptocurrency exchange Binance announced on Wednesday that it has decided to pull out of its planned acquisition of rival FTX. The latter has had financial problems, which undermines the stability of the entire cryptocurrency market. According to sources Reuters and Bloomberg, the case is being investigated by the US Securities and Exchange Commission (SEC) and the US Department of Justice. Bitcoin, the largest cryptocurrency, is trying to recover from a two-year low.
In November of this year, the entire Bankman-Fried empire collapsed. It was triggered by a tweet from its main competitor, Binance CEO Changpeng Zhao. He said that Binance will phase out most of the cryptoassets FTT, which used to be the main cryptoasset issued by the FTX exchange. According to Zhao, the token market was driven by the Alameda hedge fund, owned by Sam Bankman-Fried.
This triggered a chain reaction of sales and a dramatic decline in the value of the FTT. At that moment, the whole system collapsed, similar to the moon cryptocurrency spring crash. At the same time, even in the summer, Bankman-Fried gave several interviews about the fall of the moon and how his empire resists such a situation.
What is worth investing money in?
The inflation rate is currently very high and few dare to estimate its further development. The money we have in cash is losing value every day, and even the interest on savings accounts is nowhere near keeping up with inflation. Therefore, many of us consider how to protect our savings from depreciation. There are several options for how to invest money, thereby protecting it from inflation and even increasing its value.
All about inflation
Scarecrow of inflation. What causes it? How to defend yourself from her? How to invest, where to save, where are there decent interest rates, what bonds are worth it? How does the state, the government and the CNB fight inflation? Who and why increases the price and how much? How to deal with price increases? Is it the right time to get a mortgage, will interest rates go up or down and why? Context, hints, tips, warnings.
High inflation worries not only Czechia, but also other European countries and the United States. See the overview in the world.
