SBF (or someone on the inside with him) hacked the remaining half a billion worth of client funds at FTX. Transferred the fund from both FTX and FTX.US, launched a trojan on the FTX app (do NOT update app if you get a request)... and immediately started washing those funds into coins that can’t be seized easily. I cannot remember such a trainwreck bankruptcy ANYWHERE including Enron, Madoff and Mt Gox.
Muskrats living in tight cocoons on Mars while suffering from radiation poisoning in malnutrition - "we're living in the future bro, thanks Elon".
I didn't realize that banks borrowed from deposits and traded shares OTC with their wholly owned subsidiary as the only mark to market. Cool.
I think the point was about the fact that not everyone can withdraw at once. We clearly don't have to worry too much about bank runs here in the west because any shortfall is going to be covered by the government with printed money. It does make a bank somewhat safer than a crypto exchange. But instead, the taxpayer gets to subsidize this "insurance" and any shortfalls are covered by the slow and steady devaluation of dollars. Listen, what's happening in crypto right now is awful, but this is no way demonstrated that traditional finance and the current monetary system is superior. If anything, central banks have made the vast majority much poorer in the past 30 years than crypto has. Most people are just working to live and eat while the top 1% get to enjoy a glamorous life. What this crypto collapse is demonstrating in real time and excessive speed is how a few smart people steal from everyone else. Its exactly what is happening in the dollar system as well.
I her that Jamie Dimon wired $600MM out of retail customer accounts to buy a couple Gulfstreams. You may as well entrust your cash to the local bookie. crypto is absurdly anachronistic. They only way your shit is safe is the inconvenience of cold storage or a regulated US shop. SBF decided he didn’t like being broke so be moved $600MM to his wallets over a period of 20 minutes from the most secure (sic) exchange in the world. Please stop. Fractional banking is regulated. There is an audit trail. They buy securities and offer a guarantee.
Crypto won't change that. The smart people will still end up with most the money. Whether the unit of exchange is fiat or crypto, human nature won't change.Right now the smart people are betting against crypto.
Centralized companies (i.e. Exchanges, investment firms or others) should have segregated accounts and must not commingle crypto assets Crypto assets, like btc, eth, usdt, usdc can settle onchain 1-to-1 within a few minutes on a 24/7/365 schedule Fiat accounts such as USD, Euro, Yuan have time-settlement constraints due to off-hours banking, international wire transfer delays, holidays and such If I deposit $100K worth of BTC or USDT to Coinbase and want to trade for other crypto assets, there is an expectation that should I choose to withdraw at 11PM local time on Saturday that I will get the full amount minus network tx fees Any crypto asset deposited on a centralized exchange should always have a 1-to-1 settlement to the blockchain This is why a true crypto exchange charges exchange fees in cryptos to maintain all cryptos balances consistent 1-to-1 settlement to the blockchain There is no expectation of the same settlement with fiat since not instant and has time-duration allowances, so the centralized exchanges can put in money market or buy treasuries to earn yields and stuff One last note, if a big investor deposited $1B at a centralized entity and after a month of full fiat settlement and bought $1B worth of btc and decided to withdraw and was unable to do so because the btc's are not available, they were selling btc's that did not exist in their wallets and thus did not exist 1-to-1 on the blockchain Similar to what happened with FTX but on a much bigger scale, a bank run of crypto assets should never be a problem for a crypto exchange and Binance has tweeted it will never be a problem there, we shall see. Coinbase has issued similar statement as well as Kraken