The CEO of FTX; Sam Bankman-Fried says crypto exchanges are ‘secretly insolvent”
Ever since the inception of the current crypto bear market; a lot of Crypto organisations have been at the edge of getting liquidated.
The first is Celsius – an all-in-one banking and financial services platform for cryptocurrency users. This company had to face the problem of getting liquidated because of the severe market conditions.
Celsius team took an unusual step to tackle this problem by halting all withdrawals from their platform. Regardless that this action was taken to combat liquidation threats; it totally went against the value of the company.
Celsius is not alone in this battle; even the largest crypto lending platform – BlockFi, was at the risk of losing it all because of the crypto winter season.
BlockFi announced on June 13th that it will be laying off 20% of its total staff as a means to combat the bear season. BlockFi was not the only cryptocurrency exchange that had to lay off a percentage of its staff.
US largest crypto exchange – Coinbase also took actions to reduce the number of staff that the company had. Curbing the workforce to 82%; causing over a thousand staff to kiss their jobs goodbye.
Crypto.com did not hesitate to follow the steps of the other exchanges. Laying off 5% of its company’s team as a means to cope with the market conditions and ensure sustainable growth.
The FTX CEO blamed the Fed for the current market situation; stating that “people with money are scared” because of the terrible interest rates – which was also an accomplice to crashing the crypto market.
With Bitcoin and Ethereum down below 50%; cryptocurrencies have been tagged as risk assets. Everyone in this space was badly affected; including the well-known Singapore-based crypto hedge fund; Three Arrows Capital is at the risk of getting total liquidation.