In the world of economics, the discussion about the crypto exchange FTX is hot these days. This company has reached the verge of bankruptcy. Due to this, investors and customers are holding their breath. At least $1 billion of customer funds are missing on FTX. On the other hand, the company has applied under the Bankruptcy Protection Act in the US. Company founder and CEO Sam Bankman Fried have resigned. In this episode, we will also know whether such an economic risk can be imagined in India. After all, what are the rules for this in India? With this, we will know what is FTX.
what is ftx
1- FTX is a cryptocurrency exchange built by professional traders. The exchange provides access to regular spot trading. It supports money transfers in FIT and a wide range of cryptocurrencies. FTX aims to cater to both retail and institutional traders, providing a wide range of products and services geared towards more professional traders.
2- In the year 2019, FTX was launched by crypto traders Sam Bankman-Fried (CEO) and Gary Wang (CTO). FTX's main center of operations is in Hong Kong. The exchange is owned by FTX Trading Limited, a company incorporated in Antigua and Barbuda. The motto of the exchange is that FTX was built 'by traders for traders. It offers a wide range of transactions as compared to other crypto exchanges. The founders of a powerful trading platform founded Alameda Research, a cryptocurrency fund that leads many trading charts by volume.
In such a situation, the question arises what is the rule for this in America? According to reports, it may take years for people to get their money back. One of the major reasons for this is that the person who has given a loan to the company has the first right to the amount recovered under the prescribed law. After this comes the number of investors. Customers come on the third number. According to Reuters, at least one billion dollars of customer funds are missing in FTX.
What are the rules regarding crypto exchange in India?
1- A question also arises that what would happen if such a situation arises in India. That is, what if a big crypto exchange like FTX in the country or any organization handling crypto investors' money goes bankrupt, the chances of crypto investors or account holders getting their money back are even less if they are in India.
2- This is because at present there is no rule or regulation regarding the crypto industry in India. The government has started imposing a tax on the earnings from crypto transactions but has not been able to bring any bill regarding cryptocurrency so far. This is the reason why no bank even deals with these crypto exchanges. However, despite this, thousands of youth are investing their money in these assets in the hope of getting hefty returns.
Sam was worth $15.2 billion before bankruptcy.
1- FTX CEO Sam Bankman has suddenly resigned from his post. FTX has also applied for protection under the US bankruptcy law. Before bankruptcy, Sam was worth $15.2 billion. His net worth has declined by about 94 percent in 24 hours. Sam's net worth dropped to $991.5 million. This is the biggest fall in the wealth of any billionaire in 1 day.
2- Sam used to compare his FTX with Warren Buffet. Sam Bankman, the founder of the FTX company, was considered the most veteran investor in the crypto world. Many times Sam was compared to Warren Buffet, a veteran investor in the stock market. FTX came crashing down this week due to a billion-dollar fund crunch. The exchange collapsed after Binance pulled out of a proposed deal to buy it earlier this week. With this, he failed to raise $ 9.4 billion from investors.
Binance deal canceled, company files for bankruptcy
Let us tell you that for some time customers were leaving FTX due to the fear of a shortage of funds. For this reason, it was decided to sell FTX to rival company Binance. The company filed for bankruptcy on Friday, just 24 hours after the Binance deal was cancelled. The application names 130 subsidiaries related to the company, including San Bankman Fried Hedge Fund and Alameda Research.
Earthquake in the world of crypto
The crypto world has been in turmoil after the collapse of the high-profile exchange FTX. As a result, the number of people who like BlockFi and Galaxy Digital has increased. According to a notice titled Forward Through Eversity on the website of the exchange, due to the failure of the third-party partner, some users' balances were abnormally recorded in the system.
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