The FTX bankruptcy has sent the crypto space into a downward spiral, and the crypto space is still buzzing to get all the details that led to this situation. Numerous reports have popped up, and the bankruptcy hearings bring new information daily. Considering the extent of FTX’s involvement in the global crypto space now is the time to take a hard look at what happened and draw some valuable lessons.
One thing is very clear from the start - what brought the exchange giant down was overallocation in low-liquidity tokens, mainly its own FTT cryptocurrency. While FTX specifically could get away with having tonnes of FTT on its balance sheets, sister company Alameda Research couldn’t get off the hook so easily.
Material is provided in partnership with HEXN.io