Sam Bankman-Fried, the beleaguered former CEO of the ailing cryptocurrency exchange FTX, is attempting to seek funding to save the platform. Still, the effort has been met with mixed emotions amid worries that the funds may be mishandled.
Evidence suggests the liquid assets of the crypto exchange are reportedly not as liquid as they are made out to be, according to Kaiko researcher Conor Ryder. As of November 16, Ryder noted that FTX’s “Liquid” assets were at a bid depth of 2%.
In particular, the researcher pointed out that the aggregate bid depth of Polkdadot (DOT), Pax Gold (PAXG), and TrueUSD (TUSD) was only barely over $7 million, which corresponds to a bid depth of 2% and indicates that these cryptocurrencies ‘should probably be classified as illiquid.’
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“They hold $28m of $DOT, $23m of $PAXG and $12m of $TUSD they classified as liquid, as per @FT. As of this morning, 2% bid depth for the three tokens combined is just $7.1m – should probably be classified as illiquid”
FTX consumers ‘will likely get nothing’
Before the $477 million hack occurred, FTX had less than $1 billion in liquid assets, while it had $9 billion in liabilities. On November 12, Coffeezilla noted:
“Situation is now SIGNIFICANTLY worse. Customers will likely get nothing.”
The cryptocurrency industry is still suffering from the shock of FTX, formerly the biggest crypto exchange, declaring bankruptcy and its CEO resigning. Sam Bankman-Fried is seeking funding to save the platform; the initiative has been met with mixed emotions due to concerns that the funds may be misused.
The creator of the meme cryptocurrency Dogecoin (DOGE), Billy Markus, has expressed concern that raising funds to save FTX would allow Bankman-Fried the opportunity to ‘commit enormous fraud again.’
In addition to Markus, a number of prominent individuals have discussed their opinion on Bankman-Fried. Elon Musk, CEO of Tesla (NASDAQ: TSLA), was one of these individuals, and he said that his first meeting with the company’s founder resulted in his “bullshit meter redlining.”
Elsewhere, Robert Kiyosaki, author of the personal finance book “Rich Dad, Poor Dad,” has referred to Bankman-Fried as “the Bernie Madoff of crypto,” as reported by Finbold.
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