While the failure of the third-largest cryptocurrency exchange could be a disaster in itself, Sam Bankman-Fried could destroy hundreds of other companies linked to FTX, creating another knock-on effect in the market.
Sky Mavis, Circle, LedgerX, Voyager and Blockfolio are a few with investments from FTX. As for the latter, Blockfolio, even the giant Pantera Capital has already admitted that it was indirectly affected by the broker’s insolvency.
“On the Pantera side, we had negligible exposure to the FTX platform and gained exposure to FTX as a shareholder, primarily through the acquisition of our portfolio company Blockfolio.”
This is just one example of how much FTX is affecting the market and how its collapse has led to an overall drop in the price of cryptocurrencies, including Bitcoin.
FTX, an empire being destroyed
In addition to aggressive marketing, making its name visible to Formula 1 fans as well as those who prefer esports, FTX has also invested some of its money in other companies, not a few.
A Fortune report shows that Sam Bankman-Fried divided his empire into four parts: FTX🇧🇷 FTX VS🇧🇷 FTX companies and Research Alamedathe latter having more investment than the other.
Messari, Polygon, Solana, Lido, Voyager and Consensys are the main names, recognized even by those not so connected to the industry. However, the list goes on with dozens of other Alameda investments.
FTX Ventures is another that has poured money into the market, including Yuga Labs, creator of the most famous collection of NFTs. However, what would be a blessing for these companies is turning into a curse.
The only one that could be safe is FTX US, which, after all, operates under strict US laws. But the truth is that even BlockFi has already paused recordings, so everything points to there being no solid ground.
Lehman Brothers look small next to FTX, emphasizes FT
The Financial Times was also shocked when it compared the size of the 30-year-old former billionaire empire to that of Lehman Brothers, the investment bank that went bankrupt in 2008 during the subprime crisis.
By means of an image that does not even fit on a computer screen, it is possible to get a picture of the situation. After all, only the list of countries is long: Australia, Antigua, Japan, Hong Kong, Bahamas, Nigeria, Singapore, Switzerland, Ireland, Germany, South Korea, Cayman Islands, USA, Cyprus, Turkey and others.
Finally, Sam Bankman-Fried is still trying to save his empire, hunting for investors willing to burn money. Either way, it’s hard to believe that your trust will be restored. In other words, we are witnessing the collapse of not just a brokerage, but an empire.
Source: Live Coins
John Cameron is a journalist at The Nation View specializing in world news and current events, particularly in international politics and diplomacy. With expertise in international relations, he covers a range of topics including conflicts, politics and economic trends.
