We have all heard about what's been happening with FTX, and we all have seen our bags decrease in $ value and it's not good times. From my POV, I just saw this as another exchange/cefi project to go busto but recently i have been seeing that FTX was different because it had a different type of investor compared to Celsius or Luna. By investors, I mean angel investors or institutional investors. Im sure Celsius had some but not to the level of FTX.
FTX crashing and going bankrupt will leave massive ripples in the crypto pond and actually bring us to a better place in the end but for now, we might have some pain ahead of us. Lots of people, important people are very pissed off about FTX and I think this is when people will start to lobby for more crypto regulation. This kid, this $40 billion kid will walk away from this I'm sure with hundreds of millions stashed away hidden. He will never do 1 day in jail and is set for life for mismanaging tens of billions of dollars for over 1 million customers. Retail investors are powerless but institutional investors have power and they might exercise it.
FTX tried to be Mr big balls back in the summer when it was bailing out all the failing cefi projects left, right and centre. All that money was lost and this genius kid never really paid much attention to his liquidity. It's been giving out loans and accepting its own FTT token as collateral and half the management staff is made up of bfs and gfs, like a huge feat boy orgy. Picture a nerdy version of Wolf of Wallstreet and that's what I'm thinking.
Because FTX had a lot of institutional investors, the word on the street is the city is hating crypto right now and many funds are pulling out and saying they will not reinvest into crypto until crypto is regulated. The next 3-6 months could be a real shit show within crypto as the FUB will be strong. This could lead to others falling as well, it's not that hard for a run on the bank to happen. CZ of Binance brought down FTX with a tweet.
I personally hope it helps to get crypto more regulated. I know some people will not like that and think that crypto should be unregulated but your either one way or the other. I've lost a lot of money from exchanges or Cefi going busto or rugging and I'd like for the people responsible to do the time for the crime are at least get fined/sued into almost bankruptcy.
If you think unregulated is better, think of how banks operate in the regulated space and how corrupt they are. Can you imagine what they would do and how they would control you in an unregulated space? It's only a matter of time before we have a trillion-dollar crypto company, would you what that in an unregulated market? I wonder what a $1 trillion hack are rug pull would look like, lol.
FTX could be the final nail in the coffin and could be the one that gets the ball rolling for proper regulation or it could just be another one in the long line of crypto companies to go busto from bad management. This happens every cycle, there is always something, 1 big one. Things were very bad for crypto after mtGox got hacked, for those that were around, i think they would agree with me on this that, that was a huge make-it-or-break-it point for BTC and crypto as a whole. In today's terms, this would be like Binance getting hacked and both the exchange and BSC going down forever. In fact, mtGox was still worse because it was the only player in town. Today, SOL, MATIC, DOT or ADA would replace BNB, people would just move from one to another. In 2017 Bitconnect happened and a few billion were lost, this was the big story and what mainstream media reported as the reason for the 2018 crash.
There's a crypto cycle every 4 years and there are always billions of dollars going missing or stolen so it's easy to point at one and say, that's the one that crashed the market. The fact of the matter is, the market is already declining, an event like this just pushes it along.
We know this, we understand the market cycle because we've been through a couple of them. The people in power will mostly only understand that Celsius, then Luna and now FTX went busto this year and it crashed the market by 20%. They don't understand that -205 in crypto is just a bad day. Shit China bans crypto every year and it drops 15-20% for a few days until we realize nobody cares.
What do you think will be the ripple effects of FTX going bust?
Do you think it will spend up regulation?
Will other companies fall in the coming months?
Will it all be forgotten about in 2-3 months' time?
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I think it will decrease the confidence in the crypto space, many investors will exit the space (at least for awhile) till there's some certainty (like proper regulation). This is an opportunity that regulators can leverage to make some rules and laws concerning the space.
I agree with pretty much all your points. Fingers crossed this time in 5-10 years, we have regulated defi bank.
I think stuff like this still happens in the traditional system. You just see people get held accountable for it. Maybe not to this level. The problem isn't crypto, it's bad actors. People won't see it that way... I think this is going to be good overall. People need to stop looking at crypto as a get rich quick thing and realize the utility of it all. This might bring that about sooner.
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That's a good point. Banks are not bad things, it's the people running them. I remember in 2007 seeing 120% mortgages, complete fooking madness.
I also think this will be a good long time as well, seems to have really annoyed a lot of people. The days of easy money could be numbered and instead of easily earning 20% on crypto, we might have to get used to 5-10% per year the same as the stock market are precious metals but it will be a safer space for sure.
I hope we have a couple more bull runs before it settles into that type of market. :) I'd like to position myself a little better for those kinds of rates. Yeah, those balloon mortgages were nuts.
not your keys . . .
You can lose your keys, get hacked or your hardware could break. It's happened to millions of people already. The normal person is not very technical and might save keys/seed words to the cloud or something like a notepad on their computer thinking they are safe. Crypto needs to be idiot proof
Personally, i like a mixture of both when storing crypto. I don't mind having some funds sitting in my MetaMask and Binance account for defi but i like my ledger for BTC and cold wallets for other long-term holds, mostly ERC-20 tokens that are expensive to move, lol.
That is why it is advisable that we should stop storing all our cryptos on an exchange.
Agreed. I was lucky with FTX, I had been buying some SP-500 shares each week for a few months building up a wee stash and about 6 weeks back, I took the notion to sell them and cash them in BUSD to use on BSC. Was not a fortune but was 4 figures.
SPI (another project I run) lost $2500 with Celsius and was super lucky also, I moved 1 BTC from it to a ledger a few days before it went busto. I got a tip from another SPI team member that things were looking bad for it. It was lucky I acted on the advice, I don't always.
And finally, I lost 8.3 BTC in mtGox way back.
Your preaching to the choir
Wow that was a huge loss..
From where I see it all will be forgotten in 2-3 months.
Ftx has went to far with dishing out loans like cookies and now facing the blowback. Sadly its the avarage Joe who gets to leave without billions of dollars.
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You are probally right, if big wig investors don't act on it soon, it'll pass over like the others before it.
This is one I never lost any money with. I have the app and used to save into it but currently have a £0 balance. The app was laggy for me and that's enough for me to pull funds cause I don't like to be pissed off when trying to buy stocks. Same reason I don't use POLY, it's too slow and I don't have much patience, haha,
I was watching FTX in the summertime bailing out Celsius and Blockfi and remember thinking, where is all that money coming from? I always pictured FTX to be big but not big like be able to hand 8-9 figure loans out. Complete madness
My fear is that it is creating more and more centralisation in Binance and to hear the idiots on Twitter talking about how great CZ is making me throw up. I will always remember that he used user funds to take control of the steam blockchain. ( Although I do use Binance to buy hive)
I am sorry for those who lost money, genuinely I am but, how many times does this have to happen before we understand that the whole point of crypto is that we should not have to trust each other with our crypto? At this point, I look at these events as a tax on the silliness of investors.
Regulation will come down hard but hopefully, it will force to whole space to follow its most basic rules. If it doesn't, well, then there is little hope of mainstream adoption.
Rant over!
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