Shocking downfall of second biggest cryptocurrency exchange has been compared to Lehman Brothers, Enron and, of course, Theranos
during his Thursday Attendance On CNBC’s “Squawk Box,” Galaxy Digital CEO Mike Novogratz compared the troubled FTX exchange to infamous biotech start-up Theranos. “You know, we basically have a situation that looks like Theranos,” he said.
Elizabeth Holmes, the disgraced Theranos founder who was convicted of fraud earlier this year and lost her bid for a new trial, was believed to be the next Steve Jobs after becoming America’s youngest female billionaire. Meanwhile, FTX boss Sam Bankman-Fried had been named “the next John Pierpont Morgan” after he became the richest millennial with a $26.5 billion fortune.
Novogratz described Bankman-Fried as “thoughtful” and “charming” based on his previous conversations with the entrepreneur.
Illegal or immoral?
Earlier today, Reuters reported that FTX allegedly used customers’ funds to prop up the Alameda Research trading firm. Novogratz claims that Alameda made large investments in “illiquid stuff.”
The cryptocurrency mogul says he’s not certain that FTX’s action was illegal, but he says it certainly “feels immoral. Either way it’s been a physical blow to trust … market confidence.” are about.”
Novogratz says that he is “furious” because the current crisis is “frustrating.”
Earlier today, Bankman-Fried announced that the cryptocurrency firm Alameda Research, which used to rule the cryptocurrency market, is now shutting down. Stablecoin issuer Tether also froze $46 million of USDT held by FTX due to a law enforcement request.
