Appearing before the US Senate Banking Committee, Kevin O’Leary, who was asked to testify, explained how Binance orchestrated the downfall of FTX. The two cryptocurrency exchanges were at war with each other. Perhaps this testimony will finally help us understand how an exchange managing billions of dollars in assets could disappear overnight.
Could Binance be behind the fall of FTX?
Changpeng Zhao says “CZ” and Binance, the cryptocurrency exchange he created in 2017, owned 20% of FTX shares. The two giants of the cryptocurrency industry were unregulated in several countries. Now, it looks like FTX was well on its way to changing that. For its part, Binance has more difficulty with the jurisdictions in which it operates. In the video of Kevin O’Leary’s testimony, he can be heard saying that apparently, according to Sam Bankman-Fried, CZ did not want to cooperate with regulators to provide the information necessary for FTX to obtain a license.
Faced with this hostility, Sam Bankman-Fried, CEO of FTX, had to make the painful decision to buy out all the shares held by Binance and CZ. We are still talking about an unforeseen expenditure of $32 billion. His efforts to save his exchange were not helped by CZ, who proceeded to liquidate the FTX tokens in his possession. The objective was to bring down the price of FTT and precipitate the fall of its competitor.
Is Kevin O’Leary objective?
This investor allegedly lost the equivalent of $10 million in cryptocurrencies with the fall of FTX. Corner Telegraph also tells us that he would have been paid up to 15 million to be the spokesperson for FTX. Furthermore, he warned in a youtube video that he would get his money back no matter what. Perhaps he thinks that by attacking Binance he has a chance of getting some compensation.
Conclusion
This is not the first time that we have been made by reasons why FTX would have gone bankrupt. Nevertheless, millions of small customers have not yet received a penny. On the other hand, big investors split millions. Hence the urgency of appropriate regulation to clean up investment in cryptocurrencies. If this situation continues government restrictions more and more severe could appear.
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