But blockchain firm Ripple’s CTO David Schwartz weighed in on Sam Bankman-Fried’s supporters, but also detailed what went wrong with the company.
Ripple CTO Opinion on FTX Collapse
the executive list three things that went “terribly wrong”.
The trust assets of FTX clients were left in the Alameda accounts and used by Alameda. Client deposits that FTX was supposed to hold were mixed with assets used in riskier ways. Alameda was supposed to be running near-neutral risk management strategies. Somehow, positions were not tracked, risks were not managed at all, and strategies were not neutral at all.
While the executive does not want to believe that there has been corruption at FTX, he added that even “deliberate blindness” by the bankrupt company’s leadership is equally appalling. Schwartz considered that “bad luck” during a prolonged bear market can cause many cryptocurrency companies to close their doors. But that’s not the case with FTX and its sister trading firm Alameda.
Shark Tank Star’s puzzling take on SBF
But there are industry experts who do not share the same belief that Bankman-Fried may have committed a crime. One of them is Shark Tank star and investor Kevin O’Leary, who has confessed to losing $15 million that FTX paid him to be his official spokesperson.
At a time when much of the crypto community has turned against Bankman-Fried, the TV personality’s comments naturally drew significant backlash. The investor had recently stated that SBF should be treated as innocent until proven guilty. In another interview, O’Leary claimed that he would invest in the disgraced if he came up with a new venture.
But Ripple CTO David Schwartz is having a hard time deciphering Mr. Wonderful’s take on the whole fiasco, especially after the latter restored faith in Bankman-Fried’s trading prowess. schwarz tweeted,
“Maybe your mindset is ‘Hey, a lot of people lost a lot of money, but Sam made sure it worked out for me so I would do business with him again.'” But if there is some other possible explanation, I prefer to believe that. The thing is, I’m not sure there’s another possible explanation.”
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This post The three things that went wrong for FTX according to Ripple CTO
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