THE CRYPTO CRASH THAT DIDN’T BARK IN THE NIGHT
November 12, 2022 -Durt Fibo

The world’s second (then fifth)-largest crypto exchange, has collapsed overnight as a result of missing intrinsic value, inherent corporate hijinxs, and near-total missing deposits. FTX, the exchange founded by Sam Bankman-Fried and Gary Wang in 2019, announced early this morning that it had ceased operations.

This past Monday, November 7, Bankman-Fried had posted on Twitter: “A competitor is trying to go after us with false rumors. FXT is fine. Assets are fine.” The following day, Binance, the world’s biggest crypto exchange had seemingly decided to prop up some marshy crypto lands, with its CEO Changpeng Zhao tweeting: “There is a significant liquidity crunch. To protect users, we signed a non-binding [letter of intent], intending to fully acquire FTX.” (Zhao had previously promised Elon Musk $500 million of Binance’s money towards Musk’s purchase of Twitter). By Wednesday, Binance had popped its eyeballs at Bankman-Fried’s books and withdrew its offer to buy FTX.

In an alert pinned this morning to the FTX Support Telegram chat by the company’s General Counsel Ryne Miller, would-be clients read: “FTX has been hacked. FTX apps are malware. Delete them. Chat is open. Don’t go on FTX site as it might download Trojans.”

Between $600 million and $2 billion of clients’ deposits vanished Friday night/this morning, and the exchange initially told the public that it was the work of a suspected hacker attack. An avalanche of online suspicions immediately changed the color of the bankruptcy by questioning whether, rather than an outside hack, someone inside the company might’ve been responsible. It is now known that Sam Bankman-Fried had secretly transferred $10 billion of client funds from FTX to his affiliate trading firm Alameda Research, allegedly on the same day that the firm filed for Chapter 11 bankruptcy protection. That filing includes FTX Trading Ltd. and 134 affiliates of the debtor including Alameda Research, Atlantis Technology, Bitpesa, Blockfolio, Cedar Bay, DAAG Trading, Global Compass Dynamics, Hawaii Digital Assets, GG Trading Terminal, Ledger Holdings Inc., Liquid Financial, Western Concord Enterprises, FTX US Derivatives, FTX US Services, and FTX US Trading. Since then an undetermined amount of the money in question has vanished into thin air; Sam Bankman-Fried, so far as the public knows, is currently bereft of any material wealth.

Naturally intrigued by such immense implosions, Elon Musk —or, rather, anyone using his face and ‘official’ grey check– announced on his recently purchased Twitter that the company (ie Musk and his distinctive black hole acumen) will leap into tracking down the FTX misappropriations in ‘real time.’