They are rolling over at FTX. Sam Bankrun-Fraud gets to stay at his parents’ house (what did they know?), for the time being, but with his co-founders rolling over and admitting guilt in the FTX fraud, I can’t imagine Bankrun-Fraud not being locked up for the rest of his life. The real question is will Bankrun-Fraud survive – will he make it to trial? We are still at 60/40 odds (60% probability of death).
In the meantime the crypto space continues to struggle. We are fans of the underlying blockchain technology, but not of cryptocurrency as a speculation vehicle. I can’t call crypto an asset because it has zero inherent value (I can’t live in a crypto coin, I can’t wear it as jewelry), it is not a store of value nor a medium of exchange. Eventually the market will figure this out. Many retail investors have run for the hills and the institutions that are propping up BTC’s value at $16-17K (Grayscale, Ark Investments, etc.), will eventually flee as well. Want to know where much of the Trump and Biden stimulus checks went? Crypto, that’s where. Now the bottom has fallen out. What a mess.
Coinbase is a bankruptcy-in-waiting. Binance is likely toast, but I can’t be as definitive with Binance as I can be with Coinbase because Beijing may be a Binance backer.