As much as one would not like to repeat oneself, it is impossible to avoid the seriousness, extent and nature of the FTX meltdown. Weeks after the breakup, at the beach bar that Sam Bankman-Fried has built around a complex business web, discord and confusion still reign. At its first bankruptcy hearing, held on November 22, FTX lawyers said that a “significant amount” of the company’s assets were missing or stolen, and that the empire was being run as a “personal fiefdom.” From Bankman-Fried. The bankruptcy manager himself, Enron, is amazed: There is no documentation, and it is difficult, if not impossible, to identify and track the assets of the companies that allow customers and creditors to pay.
Bankman-Fried, who had just accepted voluntary extradition from the Bahamas to the United States where it would face charges of defrauding its customers, wanted to clarify what had happened to what was left of its staff. After admitting to losing $51 billion in collateral and apologizing for the group’s quick demise, he’s complaining he’s been forced into bankruptcy in Delaware (always Delaware) court. According to him, this could have been avoided: “Once I signed the Chapter 11 documents [el que rige la presentación de quiebra en EEUU] The potential interest in billions of dollars in financing “to save the company” was demonstrated. It appears to be something for Silicon Valley executives to live in a parallel reality in which foundations put money into companies that have sucked up all the money received and no assets to respond to. Incidentally, nothing is mentioned in the His letter from exile is about the loans the company made to him and other of its executives.
The damage from FTX’s downfall, after a bloody year for the crypto thing, extends far beyond the companies it had ties to. Sequoia has lost the $150m it invested, and crypto lender Genesis, which left $175m in FTX, has frozen withdrawals and has already hired restructuring experts, which looks like a precursor to another bankruptcy. But for Senator Elizabeth Warren, a Democrat from Massachusetts and a candidate in the last US presidential primary, the damage is more serious and affects the integrity of the financial system as a whole, which could roll back again if the financial system is not regulated. assets immediately. Paul Krugman believes that regulation will kill the cryptocurrency mirage: “If the government finally decides to regulate the crypto industry, which, among other things, will prevent them from promising unobtainable returns, it is difficult to say what advantage they can offer compared to ordinary banks.. There is every reason to hope that the cryptocurrency industry, which seemed so majestic just a few months ago, will end up in oblivion.”
How did we get here? Stephen Dehey, an activist against the crypto-asset market, asserted in an interview with the Financial Times and in various posts on his blog that cryptocurrency is nothing more than the result of “the commodification of populist anger, gambling and crime.” “Cryptocurrency is a huge scam, albeit a sophisticated scam…” he asserts. “I’m not going to say if we have a 100% answer. [si el blockchain es útil]. But the answer appears to be no. The interview cites the example of an Australian stock exchange that abandoned an attempt to move a clearinghouse system to a blockchain-based platform, losing A$250 million ($168 million) and seven years of work.
In his work Popping the Crypto Bubble, Diehl traces the history of bitcoin from its birth during the global financial crisis to the post-2016 cryptocurrency rush, which he refers to as the “age of scammers.” He argues that cryptocurrencies are slow (reliant on transmitting transactions over decentralized networks) and unreliable (investors are responsible for securing their assets; when they lose passwords or die, there is no way to recover the assets). For Diehl, it is clear and obvious that a crypto asset cannot be a great investment, which goes up and down, and a viable currency, which provides stable value. Indeed, I would venture to say that not only does its speculative nature make it viable as a currency, but also the absence of a productive market economy around it. There is no real market for goods or services, except for laboratory use cases that no one uses, which can be purchased with crypto assets. It is perhaps because, in spite of the efforts of many, that they are not currency but a right of fiduciary against a community without collateral or guarantees to guarantee it. precisely because, in its constitutive nature, there was nothing in the material world to support it apart from consensus and recognition within society.
Despite the fact that Satoshi Nakamoto wanted to create a virtual currency that would give control of the economy and issue money to a decentralized and libertarian society, the reality turned it into the exact opposite: highly speculative assets subject to capitalism. To call it currency or that the Treasury regards it as money for the purposes of cash disbursements leads to the confusion of thinking that it is a substitute for fixed term in the bank and that the savers (mostly men, it must be said) think, therefore, that they alone have found a way to get rich, and to accumulate huge capital gains, while having Controlled risk. The ideological component of investees that Dale refers to is not lost on anyone.
In case we’re lacking in sauce, our CEO at Neronian at the moment, Elon Musk, poked fun at FTX’s bankruptcy on Twitter by saying his “bullshit meter was in the red” when he met up with Sam Bankman-Fried. What has now been revealed is that he was asked to invest $100 million in buying the social network. If that doesn’t fit the tone of the times, I can’t think of what.
You can follow country technology in Facebook s Twitter Or sign up here to receive The weekly newsletter.
Subscribe to continue reading
Read without limits