Crypto Is Now Dead

FTX, a cryptocurrency exchange, collapsed last week, proving a lot of cool guys horribly wrong

- Chetan Bhagat

Bitcoin, the original cryptocurrency, the gold standard for all things crypto, crashed last week. Bitcoin prices fell a whopping 75% in the last year, or down to a fourth of its value. This, for something touted to be a better store of value than gold, US dollars or any other fiat currency or precious metal.

Other cryptocurrencies have done worse. Many are down 80-90% in a year, some completely wiped out. Most investors in crypto are now sitting on losses. FTX, one of the big crypto exchanges, where people come to trade and store their cryptocurrencies, also collapsed last week. This was due to massive alleged irregularities, including customer deposits being inappropriately used to buy and prop up the company’s own issued cryptocurrency, the FTT token.

Sam Bankman-Fried, the 30-year-old CEO of FTX, who works out of an island in the Bahamas apologised on Twitter. FTX filed for bankruptcy, wiping out $32bn of value which FTX had in the last funding round. Sam himself lost most of his $17bn fortune in days. Customers, lenders and employees of FTX all have money stuck in the company, all probably gone. Other crypto entities like Celsius Network, Three Arrows and Voyager also went belly up last year, making investors lose billions.

Crypto is done. This toxic nonsense now stands exposed. However, it is interesting to go through what happened that made crypto into the world’s greatest con. In this are lessons for all of humanity, on how easily we can be fooled as people.

● The warnings were there. 

● One of the world’s greatest investors, Warren Buffet had said he wouldn’t buy all the Bitcoin in the world for $25.