This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy.
Now that FTX’s Sam Bankman-Fried (SBF) has become a favorite punching bag for crypto enthusiasts, hardly a day goes by when the former CEO of the now-bankrupt exchange is not subjected to a verbal dressing-down, and rightfully so. Now, the man who some say precipitated FTX’s downfall, namely, Binance’s CZ Zhao, is out with a fresh take on SBF’s perfidy.
The core problem at FTX was an undisclosed symbiotic relationship with the trading arm of Sam Bankman-Fried’s crypto empire, Alameda Research. FTX apparently held its client funds in a comingled bank account with Alameda Research, allowing the cryptocurrency trading firm the opportunity to skim around $10 billion directly from FTX’s client deposits to place leveraged bets using illiquid collateral, mostly consisting of coins such as FTT, Serum, etc. Moreover, FTX also allowed Alameda to assume the positions of its clients that were subjected to a margin call. In a bull market, this allowed Alameda to hold underwater positions and then sell them for a profit later on. However, in the current bear market, this strategy only produced aggravating losses.
This gig ended, however, once Alameda’s exposure to the FTT token became public knowledge, prompting Binance to start dumping its own FTT stash, collapsing the token’s price in the process. This resulted…
