Crypto Market Overview November 16th | Dex-Trade
FTX Current Situation: Update from Sam Bankman-Fried
Former CEO of crypto exchange FTX, Sam Bankman-Fried (SBF), posted a tweet in which he said he plans to raise new capital to compensate for losses to clients of the trading platform after filing for bankruptcy, as well as to increase liquidity and restart the project, which is half a step away from a massive collapse. He also spoke in detail about the situation with the assets on the platform and listed which coins and instruments are currently liquid, semi-liquid and illiquid. According to him, FTX now has $8 billion in liquid assets, $5.5 billion in semi-liquid assets and $3.5 billion in illiquid assets. This classification is intended to help with prioritization of efforts to increase liquidity and make customers whole. But don't forget that FTX could have over a million lenders, and institutional investors are rapidly leaving FTX. Therefore, the businessman set his sights on finding investors from outside. According to SBF, the liquidity crisis was the result of too much leverage, which was actively used by margin players. The businessman admitted his failure and the fact that customers can no longer get more than what is left on the exchange. In the meantime, large FTX investors, including Softbank and Sequoia, are gradually zeroing out their investments in the trading floor. And it seems that today's SBF tweet will be the last in this thread.
FTX Collapse Is Banking, Not Crypto Crash: Mark Cuban's Opinion
Shark Tank star and NBA Dallas Mavericks owner Mark Cuban believes that the recent high-profile bankruptcies in the crypto space, including the current liquidity crash on FTX, “have not been crypto blowups, they have been banking blowups,” so he continues to support crypto and invest in her new capital. Cuban's words were in response to Shark Tank co-star Kevin O'Leary, who called the FTX bankruptcy a turning point in industry history that signaled the market had bottomed out. By the way, Cuban managed to convince many investors and traders. For example, one of them tweeted: “There was nothing specific about crypto … Other recent blowups (3AC, Celsius, Voyager, Blockfi) were all essentially tradfi-style blowups too (too much leverage, bad collateral, poor hedging of liabilities from client deposits, fraud).” Kevin Hobbs, the CEO of Aventus Ventures, agreed with Kban, who believes that it is the so-called centralized crypto companies, in which large funds are invested by classical bankers, or whose management includes former bankers, SEC, CFTC or government officials, that caused all the major trouble in the crypto space. By the way, Hobbs insists that today the industry needs a new, regulated and understandable decentralized finance (defi). And it's hard to disagree with that.
Congressman Sherman Urged Not to Contain the SEC
U.S. Congressman and Chairman of the Investor Protection and Capital Markets Subcommittee Brad Sherman (D-California) released a statement on the collapse of the FTX cryptocurrency exchange and called it "a dramatic demonstration of both the inherent risks of digital assets and the critical weaknesses in the industry that has grown up around them” The politician noted that while the scale of the financial damage caused to consumers and investors in the US and around the world is unknown. In addition, he stated that it is now critical to develop a clear understanding of the chain of events and leadership failures that led to this collapse. In fact, Sherman fully supports the efforts of US regulators and law enforcement to investigate this situation and bring those responsible to justice. The congressman has been urging Congress and federal regulators for years to take an aggressive approach and counter the many threats to society posed by cryptocurrencies. By the way, back in July, it was he who called for coercive measures against the largest cryptocurrency exchanges, which refused to be submitted to the SEC after listing tokens that the Commission publicly identified as unregistered securities. And we remember that the SEC considers almost all existing digital assets to be securities, so such statements by Sherman are a direct path to the heart of Gary Gensler.