Bitcoin: "Just a useful idiot" - who is really behind the FTX collapse?

Investing.com  |  Author Marco Oehrl

Published Dec 07, 2022 10:48

By Marco Oehrl

Investing.com - The collapse of FTX gave Bitcoin a new low as the world's largest cryptocurrency. The rest of the market reacted similarly, as confidence in BTC & Co suffered considerably. What really happened, however, has not been clarified beyond doubt to this day.

Both Binance and the incompetence of Sam Bankman-Fried are traded as possible causes, but there is also another, more than plausible explanation - follow the money.

The founder and CEO of Binance Changpeng Zhao (CZ) recently denied that he was responsible for the debacle - there is no competition between crypto exchanges. In doing so, he is fighting back against accusations that it was he who brought down FTX, allegedly to take market share from Sam Bankman-Fried (SBF).

CZ argues that the market is simply so huge that it would be nonsensical to poach each other's clientele at this point:

"We don't focus on competitors because it's a waste of time and resources when the industry has only touched 6% of the population. We want multiple exchanges, multiple blockchains, multiple wallets, etc, to co-exist in the ecosystem."

Yusko assumes that some U.S. politicians are involved in the matter. SBF declared in media terms before the FTX collapse that it would donate $1 billion to the next U.S. election campaigns. If so much money was already flowing officially, what happened unofficially? Why did FTX invest in the virtually meaningless Farmington State Bank, whose deposits suddenly soared 700%?

According to Yusko, this is precisely the starting point for targeted money laundering, and so he suspects that much of the $8B in disappearing customer funds was funneled to its new owners through this and similar channels.

h2 Bitcoin technical price points/h2

Bitcoin is currently down -1.41% at a BTC/USD price of $16,761, while the weekly loss amounts to -0.75%.

Yesterday, the cryptocurrency managed to get itself into the safe zone with a daily close above the 23.6% Fibo retracement of $16,986. However, today the negative momentum increased and thus the price is in a downward movement towards the low of November 28, which provides support at $16,013.