Lightish: Liquidity crisis meets the crypto empire by Sam Bankman-Fried

The sudden crash of the billionaire Sam Bankman-Fried from crypto "savior" to the rescue recipient has the fragile confidence in the market for digital assets worth 1 organic.

ftx and Alameda Research, the Krypto stock exchange and trading company of Bankman-Fried, were considered some of the most reliable stars in the cryptom market a week ago. Bankman-Fried had strengthened his reputation by supporting struck competitors such as the lender Blockfi at the height of the cryptococris in summer. That brought him the nickname "Krypto-Pierpont Morgan"-an allusion to the banker who intervened to stop a bank run.

But on Tuesday, the 30-year-old, whose FTX exchange was estimated at $ 32 billion at the beginning of the year, was forced to turn to a rival for a rescue operation, since the fears of the financial health of Alameda to an unsustainable customer rush brought back their deposits from the market.

The liquidity crisis marked a spectacular turn of happiness for Bankman-Fried, which in less than four years had risen from a relatively unknown high frequency dealer to one of the best-known faces of the crypto industry and its de-facto chief spokesman in Washington. His paper assets rose to an estimated $ 24 billion just six months ago.

Bankman-Fried, son of professors at Stanford Law School, founded FTX in 2019 and built up the company's profile by investing millions in a top-class media campaign, which also included the purchase of the name rights for the Miiami Heat Arena of the NBA-now FTX Arena-with supermodel Gisele Bündchen Vogue magazine. He also won the support of large investors, including Softbank, Tiger Global, Blackrock and Ontario Teachers' Pension Plan that flowed in FTX.

A humble Bankman-Fried appealed to the rivalry Krypto exchange Binance on Tuesday, which signed a deal within a few hours to buy the stock exchange and guarantee the customer of funds. He held a “very uncomplicated” meeting with everyone involved on Tuesday, said a person trusted with the matter.

"Everything went at lightning speed," said the person. "He said: what happens and it is done."

The news of the deal was a shock even for experienced crypto dealers and managers. Bankman-Fried said the customers would receive all their money back, but it would take "a little" time.

"This is a historical moment. "This shows that nobody is too big to fail. FTX seemed inviolable."

The CEO of Binance, Changpeng Zhao, tightened the fears of FTX on Sunday, when he said that his crypto exchange had decided to sell its supply to FTT-a crypto token issued by FTX-due to "recent revelations that have come to light". The tweet followed a Coindesk report, according to which Alameda holds billions of FTT-TOKEN in his balance sheet, which makes his assets swell compared to liabilities of $ 8 billion.

A senior employee of a crypto trade company said: "It is almost as if a company is being used as security for a loan. And you would never do that because it is so much connected to your health as a company. If you need the collateral most to do your work, you will be worthless."

to Tuesday evening London times the value of the FTT token of the stock exchange fell to around $ 5 hours from around $ 22 hours, a break-in of more than 70 percent.

The proposed rescue of Binance from FTX also questions rescue agreements that Bankman-Fried negotiated with companies in the crypto industry that were affected by the slump in token prices this year and extinguished two thirds of the entire market capitalization of digital assets.

R3 managing director Charley Cooper said: "Until yesterday, after the collapse of Terra/Luna, FTX was revered as the savior of many parts of the ecosystem, but on Tuesday afternoon they were swallowed by one of their first investors."