Cryptocurrency was and will remain a fiction
"Its end!' exclaimed the reporters. The Economist, once the third largest cryptocurrency trading platform in Sam Bankman-Fried's empire, the mysterious founder of the company, filed for bankruptcy.
FROM. Bankman-Fried
We are talking about the deafening collapse of the FTX cryptocurrency exchange., based in the Bahamas. Founded three years ago, at the beginning of this year it had over a million users, had a separate domain for the States - FTX.US. And if a week before the crash, the fortune of the owner of the exchange, Bankman-Fried, was estimated at 15,6 billion, now it's worth nothing. "His empire, wealth and reputation were gutted", – wrote The Economist.
Bloomberg added signs of disaster: Sam Bankman-Freed's digital asset empire files for bankruptcy… FTX license to conduct investment business in Europe has been suspended. The crisis could lead to tighter crypto regulation in the US and EU. Wider Crypto Markets Hit the Fallout, when bitcoin at some point fell over 8%".
The beginning of the universal cry for the thirty-year-old billionaire, now former, put 2 November publication of the investment company's balance sheet Alameda Research, owned by Sam Bankman-Fried. And it began! venture firm Sequoia reduced the cost of its investment in FTT zero, followed by other investors. Company shares, trading cryptocurrencies, let's go down, the price of bitcoin against the backdrop of the unfolding crisis on FTX fell on 3,1% about 17 255 dollars.
collapse FTX and Alameda Research means, what assets, owned by Bankman-Fried, who was most recently compared to John Pierpont Morgan, and cost 26 billions of dollars, now according to the Bloomberg index are estimated in the US ... in 1 US.
Crypto exchanges, as intermediaries between fictitious currency and those currencies, what is in circulation in the foreign exchange markets, investors are more sensitive to the scheme of fraud, luring investors with high profits, which is paid by those, who were tempted later and invested their money "under the precedent" of the rapid enrichment of the "pioneers". The pyramidality of the financial scheme of crypto-currencies in crypto-exchanges before their eyes every day, and it is not difficult for them to choose the most opportune moment for this, to "jump" in time.
In the first half of November, the most reliable crypto addict “jumped”. And there's no doubt, that "jump" will continue. Classic exchanges rarely have problems with the return of client funds: usually, they simply act as intermediaries in the chain of asset ownership and charge a small percentage of the commission for this. Another thing is fictitious currency exchanges.
Now industry experts in the Old and New Worlds unanimously declare, that the collapse of the crypto-empire of Sam Bankman-Freed should lead to tougher rules and controls in the field of circulation of cryptocurrencies. In the United States, the Financial Stability Board said, that next year he will work more closely with exchanges and other crypto service providers, because the history of FTX speaks of the need for stricter oversight, a The Commodity Futures Trading Commission needs more oversight powers.
Resigning as chief executive officer FTX Group, Bankman-Fried confessed: "I was shocked, seeing, how everything falls apart". That's just to be shocked does not suit him. Bankman Fried knows well, what is disproportionate leverage, risky bets, dubious collateral is an integral part of all the great financial scandals of the past.
Dispute about, what does death mean FTX, is just beginning. For ten years, starting with bitcoin, the absence of any kind of security "behind the back" of cryptocurrencies has already confirmed countless times: Cryptocurrency is a sham. However, last year, for example, the number of active users of digital assets was 100 million people in January, by June they were already 221 million. Where does such a reckless faith in fiction come from??
It's not just cryptocurrencies, but also fiat (paper) money is not backed by anything. Their value lies in the size of the numbers on the banknote and the power of the economy of states., which these papers print. And do not fall for the bait of economists, claiming, what “A dollar is valued by the amount of goods, which can be bought with it".
The collapse of secured money has come, when the US brought all the gold to Fort Knox, whom gullible Europe sent there during World War II. They say: bad money drives out good money, if they have the same price. This is how the world economy works.
Elena PUSTOVOYTOVA
