Famous Analyst Evaluated the General Situation After FTX Collapse: How Will Bitcoin Go Next?

Once the third largest by trading volume cryptocurrency exchange, FTX, officially collapsed.

Ran Neuner, Host and Founder of Crypto Banter, said that the firm has filed for Chapter 11 bankruptcy protection and that its collapse could affect the entire crypto industry.

“I Think It Will Take A Long Time To Clean Up After The Collapse”

Neuner said:

“How long will it take to bring money back into this industry so people can trust it again?

This is a huge disaster… I expect the next clean-up operation to take a long time.”

Neuner suggested that this could also lead to the closure of other firms, such as crypto lender BlockFi. On Thursday, BlockFi announced that it would freeze withdrawals from its accounts:

“There is a rumor in the industry and I can’t confirm it as I haven’t seen the documentation but it comes from a reliable source, BlockFi … had an FTT secured loan to FTX.

FTT is currently worth zero and FTX cannot repay the loan.

We’ve had a series of failures in the crypto industry. Central corporations seem to have systematically gone bankrupt due to greed, over-indebtedness and so on.”

FTX was founded and managed by Sam Bankman-Fried, who also manages assets through his trading company Alameda Research. On November 2, CoinDesk released Alameda’s leaked balance sheet. A large portion of its assets consisted of FTT tokens.

While unconfirmed, FTX is suspected of using its clients’ funds to conduct highly leveraged transactions on Alameda.

Changpeng Zhao, also known as CZ, Founder and CEO of crypto exchange Binance, later announced that his company will sell its FTT assets. The collapse in FTT caused Alameda and FTX to shut down.

Neuner continued his speech as follows:

“What people suspected at the time was that this could be a move made by Binance to weaken its opponent. I thought CZ made a masterful move.”

“Unfortunately They Can Only Recover A Small Part Of The Funds In FTX”

Neuner said he thinks users who have deposited their funds in FTX can only get back some of these funds:

“Unfortunately, I think users who have funds in FTX will only see a portion of their money. And they will probably only see it after a very long time.”

“FTX Was Incorrectly Lobbying For Over-regulation”

Neuner revealed a conspiracy theory circulating on Twitter, although he did not find it very convincing.

The summary of the theory is that Sam Bankman-Fried is working behind the scenes with US officials like SEC chairman Gary Gensler to make FTX a kind of crypto “monopoly” and the government is preparing a tighter crypto regulation. Neuner said:

“Sam Bankman-Fried was lobbying for the wrong kind of regulation. He was lobbying for overregulation.”

Neuner also noted that Bankman-Fried is the “second most contributor” to the Democratic Party after George Soros, donating nearly $40 million in 2022 alone. Democrats are thought to be more hostile to cryptocurrencies and in favor of tighter regulation:

“There are loads of other crazy facts. I can’t confirm how many are real, but if there’s smoke, it feels like there’s fire.”

These speculations have caused some to worry about the safety of cryptocurrencies held on cryptocurrency exchanges. When asked which exchanges are safe, Neuner said, “We don’t know right now.”

“You want to hope that exchanges in highly regulated regions are safer. But we realized that was not the case.”

Neuner explained that exchanges generally do not hold customers’ cryptocurrencies, adding that “if you don’t have private keys, you don’t have coins.”

*Not investment advice.