Crypto Biz: Institutions short Bitcoin as SBF is ‘deeply sorry’ for FTX collapse
The monumental collapse of FTX will go down as one of the biggest corporate scandals of all time. But, at least Sam Bankman-Fried, or SBF, is sorry. On Nov. 22, the disgraced founder of FTX penned a letter to his former employees describing his role in the company’s bankruptcy. “I never intended this to happen,” he wrote. “I did not realize the full extent of the margin position, nor did I realize the magnitude of the risk posed by a hyper-correlated crash.” Get this: SBF still thinks the company can be saved because “there are billion of dollars of genuine interest from new investors.” Shouldn’t he be preoccupied with trying to avoid jail right now?
Bitcoin (BTC) and the broader crypto market have been reeling in the wake of the scandal. While this has allowed many diamond handed hodlers to accumulate more BTC on the cheap, institutional investors are using this opportunity to short the market. We may finally get that final capitulation to round out the current four-year cycle.
As always, this week’s Crypto Biz newsletter delivers all of the latest high-profile business news from our industry.
SBF’s letter to former FTX employees painted the picture of a deeply remorseful founder who managed to squander billions because of excessive margins and poor oversight. He also blamed the “run on the bank” for FTX’s ultimate demise. For those of you keeping track, the bank run that SBF mentioned was triggered by Binance CEO Changpeng Zhao who, on Nov. 6, disclosed on Twitter — of all places — that he would be selling $500 million worth of FTX tokens. That announcement triggered a tidal wave of redemptions on FTX as users rushed for the exit. Within 48 hours, FTX was shown to be insolvent.
The hole in FTX’s balance sheet is
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