Crypto Billionaires With $96 Billion Loss Add Distance From FTX – ValueWalk Premium

Crypto Billionaires With $96 Billion Loss Add Distance From FTX

As Sam Bankman-Fried’s crypto empire imploded last week, costing him effectively all of his $15.6 billion fortune, other digital-asset billionaires sought to make clear that their steep losses in 2022 wouldn't be similarly fatal.

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Cameron Winklevoss, 41, who along with his twin brother Tyler founded cryptocurrency exchange Gemini, posted an 11-part series of tweets emphasizing that Gemini “has no exposure to FTT tokens or Alameda and no material exposure to FTX,” referring to Bankman-Fried’s trading house and crypto exchange.

2/ For the avoidance of doubt, @Gemini has no exposure to FTT tokens or Alameda and no material exposure to FTX.

— Cameron Winklevoss (@cameron) November 9, 2022

Brian Armstrong, 39, chief executive officer of Coinbase Global Inc., reshared a Washington Post article from 2018 that described the publicly traded US company as “one of trust and legitimacy, in contrast to what it says are ‘fly-by-night’ exchanges that freely operate in a legal gray zone in other parts of the world.” Bankman-Fried's is based in the Bahamas.

And Changpeng “CZ” Zhao, the Binance billionaire who traded barbs with Bankman-Fried, then extended him a takeover offer only to revoke it, posted a checklist of what to avoid in crypto within two hours of FTX filing for bankruptcy. A few days later, he said his firm planned to launch a crypto recovery fund to help industry players facing a liquidity crunch.

“The real ripple effect of this is: People stop trusting other people, so people pull liquidity off of exchanges,” Michael Novogratz, the billionaire founder of Galaxy Digital Holdings, said in a telephone interview. His firm started taking down its exposure to FTX in the weekend before the bankruptcy warnings, though was still stuck with $77 million of exposure to the exchange, or 4% of Galaxy's capital.

In the interview, hours after FTX filed for bankruptcy, Novogratz, 57, said it could take weeks before “war stories show up,” given how many firms were linked to the exchange. He said the six-month period after Lehman Brothers failed, which kept stocks under pressure, could be used as a parallel to how markets may react to the FTX bankruptcy.

“I'm not saying that analogue will hold, but it will take a while,” he said.

Read the full article here by , Advisor Perspectives.

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