But blockchain firm Ripple’s Chief Technology Officer, David Schwartz, weighed in on Sam Bankman-Fried’s sympathizers but also went on to detail what went wrong with the company.
Ripple CTO’s Take on FTX Collapse
The exec listed out three things that went “horribly wrong.”
- FTX customer fiat assets were left in Alameda accounts and used by Alameda.
- Customer deposits FTX was just supposed to hold were commingled with assets used in riskier ways.
- Alameda was supposed to be executing risk-managed, nearly delta-neutral strategies. Somehow, positions weren’t tracked, risks weren’t managed at all, and strategies were not at all delta-neutral.
While the exec does not want to believe that corruption may have taken place in FTX, he added that even “willful blindness” on the leadership of the bankrupt firm’s part is equally appalling. Schwartz contemplated that “bad luck” during a long bear market may cause a lot of crypto companies to shut shop. But that is 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 such is Shark Tank star and investor Kevin O’Leary, who confessed to losing $15 million that FTX paid him to be its official spokesperson.
At a time when a major chunk of the crypto community has turned against Bankman-Fried, the television personality’s comments naturally attracted a significant backlash. The investor had recently stated that SBF should be treated as innocent until proven guilty. In yet another interview, O’Leary asserted that he would invest in the disgraced founder should he come up with a new venture.
But Ripple CTO David Schwartz is having a tough time cracking Mr. Wonderful’s take on the whole fiasco, especially after the latter reinstated faith in the Bankman-Fried’s trading prowess. Schwartz tweeted,
“Maybe his thinking is “Hey, lots of people lost a lot of money, but Sam made sure I made out okay so I’d do business with him again”. But if there’s any other possible explanation, I’d prefer to believe that. The thing is, I’m not sure there is any other possible explanation.”
The post The Three Things That Went Wrong for FTX According to Ripple CTO appeared first on CryptoPotato.
