Cryptocurrency: Noting The Carnage
grarpamp at gmail.com
Thu Nov 17 21:18:17 PST 2022
SBF could even be a patsy, while still possibly being a criminal
fraudster in this story. A patsy who believed in crypto, being
controlled by those who believe in fiat.
“They are buying all the Lambos, Mortimer! This shit is getting out
of hand. Time to kill the baby.”
The broad crypto community can’t even imagine the perspective of
someone who thinks all of crypto (and BTC) is a bunch of bullshit. For
lots of reasons, the concept of cryptocurrency always pissed off the
old white collar on a blue striped shirt finance guys.
What if FTX did not find itself in this situation by unfortunate circumstance?
What if it was built for this?
What if FTX was created to eat Ponzi schemes in the wild and deplete
them of any actual cash they had? Because the whole project was
actually architected by those who don’t really believe in crypto?
It just had to survive long enough to eat all of the major Ponzis in
the space. Extracting all the cash and paving the way for regulatory
It would go something like this:
Create a crypto exchange
Become a market maker and mover
Pretend to be US compliant by having a placeholder US presence (FTX.us)
Maybe make a stablecoin (was in progress)
Definitely make a market traded token (FTT)
Liquify the token with dollars (USDT)
Target Ponzicoin projects with proven real world cash reserves
Advance them liquidity via FTT
Securitize the loans with their cash
Extend their runways, allowing them to keep aggregating cash
Wait for their collapse
Take their cash, book a loss
Do this until you have wiped out all the major players and have set
the stage for a changing of the guard.
This money eating machine was always destined to fail. But so was the
market it played in. Perhaps the creators of FTX decided to roll up
all the Ponzis in a giant mega-Ponzi and extract all the cash for as
long as possible.
It might have lasted longer but for the recent bitcoin price drop
which injected a black swan into the timeline and likely blew out a
lot of positions FTX was counting on to remain solvent.
Where the money was intended to go is open to speculation.
How this started is a more interesting question. How much dollar
liquidity flowed into FTX via USDT to create credibility for the FTT
token is a much more interesting question.
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