On the same day, Coindesk published an article titled "Divisions in Sam Bankman-Fried's Crypto Empire Blur on His Trading Titan Alameda's Balance Sheet".

November 11, FTX, the world's second largest cryptocurrency exchange, entered the bankruptcy protection process.

Its founder Sam Bankman-Fried (hereinafter referred to as SBF) has gone into vanish overnight.

FTX evaporated its market value of US$32 billion in 5 days.

Not only that, a large number of traders, venture capital fund and cryptocurrency investors were involved, and many institutions and investors suffered heavy losses. Even this dramatic shock may spread further to the entire cryptocurrency field.

So what is the mystery of FTX's bankruptcy? What inspiration does this farce bring to ordinary investors?

Let’s talk about it today. The

event begins on November 2. On the same day, Coindesk published an article titled "Divisions in Sam Bankman-Fried's Crypto Empire Blur on His Trading Titan Alameda's Balance Sheet" .

article disclosed that most of the assets of Alameda Research, a crypto trading giant that also belongs to SBF, are FTT, the token of the FTX platform.

On November 5, the world's largest cryptocurrency exchange Binance founder Zhao Changpeng (CZ), tweeted to warn of the risks of cryptocurrencies.

The market began to run on November 7th. FTT was sold out by investors.

November 8, FTX internal emails showed that FTX's net outflow of funds in the past 72 hours was about US$6 billion, far exceeding the usual level. FTT price plummeted from over $20 to $1.5.

On November 9, SBF tweeted that Binance will take over as an investor in FTX, trying to save FTX.

On November 10, Binance tweeted that it had given up its acquisition of FTX and staged a drama of "save, not save".

FTX has since tried to find new investors, but eventually failed and entered the bankruptcy protection process.

When it went bankrupt on November 11, FTX assets had US$9 billion, of which current assets were only US$900 million. $472 million of current assets is Robinhood's stock , more than half of current assets.

As of November 15, the assets of several FTX affiliated companies have been frozen. This drama is almost over.

So what exactly is the problem with FTX? Where did

money go?

This is another big drama of "where is the money going", and in essence it is another Ponzi scam .

Alameda Research is a hedge fund , which invests in cryptocurrencies founded by SBF. It was founded earlier than FTX.

Coindesk's article disclosed that $5.8 billion of Alameda Research's net assets of $6.6 billion are FTT issued by FTX. FTX issued tokens FTT to Alameda Research, and Alameda Research pledged FTT to FTX to obtain funds.

simply means "I'll make guarantee to borrow your money."

Alameda Research continues to buy FTT, and the price of FTT can remain stable. Coindesk's article is equivalent to telling everyone that the king is not wearing clothes, and FTT is sold out, and the scam cannot continue.

The fact is more complicated than this. FTX has built a huge and complex empire in order to "operate" investors' money. Before bankruptcy, FTX had 1.2 million users and more than 100,000 creditors. And most of the debt will not be paid. In the end, FTX's debt alone will affect more than 1 million creditors.

So how much impact will the FTX storm have?

The far-reaching impact of

is of course the investors who are most directly affected by FTX.

In addition, venture capital funds have also suffered heavy losses. Before the crash, FTX's market value reached as high as $32 billion. There are many giants such as Blackstone , Sequoia, SoftBank and Temasek that have invested in FTX.

In addition, many American sports stars are also caught in it. There are many top stars such as American football superstar Tom Brady (Tom Brady ) and NBA star Stephen Curry (Steven Curry).

And more importantly, FTX's bankruptcy unravels the bottom and ugliest veil of cryptocurrency. Cryptocurrencies almost never escape the problems of money laundering and Ponzi scams.

In March this year, the Ukrainian government established a cryptocurrency donation website to accept donations from cryptocurrency. In the just-concluded midterm election , SBF donated $39.8 million to the Democratic Party, making it the second largest funder of the Democratic Party.

Does this mean FTX helps Democratic politicians launder money? Does this mean that the funds donated by the US Congress to Ukraine have returned to the pockets of Democratic politicians through the operation of FTX?

No matter which cryptocurrency is, money laundering involving embezzlement, tax evasion, smuggling and various criminal proceeds have been the main purpose of cryptocurrency.

Secondly, from the collapse of Luna to the bankruptcy of FTX, more and more investors are aware of the existence of many Ponzi schemes in cryptocurrencies. Many cryptocurrencies claim to be decentralized , but in fact they guarantee themselves, derive credit everywhere, and issue tokens indiscriminately.

When the tide of interest rate hikes comes, the outflow of capital will pierce these huge bubbles at the bottom.

Luna and FTX are good examples. The wider impact of the explosion of

FTX is that it damages investors' trust in cryptocurrencies, especially institutional investors. In the future, both ordinary investors and investment institutions will be more cautious in investing in cryptocurrencies.