Bankman-Fried promoted himself as an eccentric genius. In reality, his image was a distraction from what was going on inside FTX
Last Tuesday, FTX, the second-largest cryptocurrency exchange in the world, closed withdrawals, blaming “severe liquidity problems”. By Friday, FTX had filed for bankruptcy.
After a stupendously profitable asset bubble in 2021, the cryptocurrency industry suffered harsh reversals in 2022. A string of high-profile collapses – Terra-Luna, Three Arrows Capital, Celsius Network, Voyager Digital – lost investors a fortune, tanked prices and demolished market confidence. But FTX’s sudden collapse caught almost everyone by surprise.
David Gerard is the author of Attack of the 50 Foot Blockchain (2017) and Libra Shrugged (2020). He writes the cryptocurrency and blockchain news site Attack of the 50 Foot Blockchain