Michael Saylor on the FTX Crash: Cryptocurrency may have been the problem, but Bitcoin is still the solution

Billionaire technology executive Michael Saylor says the fall of FTX has exposed problems with cryptocurrency exchanges and is likely to drive more investors into bitcoin.

The CEO of FOX Business “Making Money With Charles Payne” MicroStrategy provided an alleged breakdown on Tuesday about what happened with FTX, calling it a “tragic situation.”

Michael Saylor, CEO of MicroStrategy, gestures as he speaks during the Bitcoin 2022 conference at the Miami Beach Convention Center on April 7, 2022 in Miami, Florida. (Photo by Marco Bello/Getty Images/Getty Images)

Saylor noted that FTX created tokens like FTT and Serum, promoted others and then passed them on to Alameda, the hedge fund of FTX founder and CEO Sam Bankman-Fried. At that point, “since the supply was largely in friendly hands, they were able to manipulate the price of those tokens through insider trading,” Saylor said.

The price eventually rose to a total accounting value of $14 billion, he said.

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“Usually, cynical bitcoin dealers think, ‘You know, these crypto casinos are just manipulating the token price to dump it at retail,’” Saylor told host Charles Payne. [Bankman-Fried] We got a particularly diabolical twist on the whole thing.”

Sam Bankman-Fried speaking at the IIF conference

Sam Bankman-Fried, Founder and CEO of FTX Cryptocurrency Derivatives Exchange, speaks during the Institute of International Finance (IIF) Annual Membership Meeting in Washington, DC, US, on Thursday, October 13, 2022. (Ting Xin/Bloomberg via Getty Images/Getty Images)

Not only did Bankman-Fried create $14 billion of faulty tokens via insider trading, Saylor said, and then tried to deploy them as collateral for a $10 billion loan — but the only bank willing to give the loan is its own.

This is how Bankman-Fried, according to Saylor, “very quietly and duplicitously pulled $10 billion or more in real assets from FTX and Alameda as they proceeded to spend money on politicians, lobbying, stadium rights, advertising, celebrity endorsements, and condos on the Islands.” Bahamas – and then they traded a bunch and made a bunch of bad deals, and then lost money.”

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But Saylor remains an important proponent of bitcoin, and argues that the disastrous situation with FTX will lead other investors to gravitate toward the digital currency.

Michael Saylor

Michael Saylor, Chairman of MicroStrategy, speaks during the DC Blockchain Summit in Washington, D.C., US, on Tuesday, May 24, 2022. (Valerie Plech/Bloomberg via Getty Images/Getty Images)

He said bitcoin fits the mold for investors who distrust traditional banks or cryptocurrencies, as well as those looking for alternatives to fiat currencies with collapsing values, and referred to bitcoin as “the most powerful computing network in the world.”

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“It means you don’t have to trust the FTXs in the world,” Saylor told Payne. “Yes, I am a big believer because I believe that while cryptocurrency in this case may be the problem, bitcoin is still the solution. [Bankman-Fried] You may have made a million Bitcoin extreme with this crash.”

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