Is This The End Of Crypto Or Just The Start Of A Long Winter?
By now, I’m sure you have heard all the gory details of the rise and dramatic fall of crypto exchange, FTX. While the story is still very much developing, there’s no doubt Netflix (NFLX) is licking their chops at the opportunity to make the next blockbuster documentary investigating the matter. Although the totality of what went on here is far beyond the scope of this newsletter, let’s go over some of the highlights.
FTX was once valued to have assets somewhere in the ballpark of $10-50 billion and was founded by a man named Sam Bankman-Fried. Now, the exchange has declared bankruptcy after arriving on some rocky shoals. Customers fled the exchange over fears of whether FTX had sufficient capital to remain solvent. After those fears were realized, it agreed to sell itself to rival crypto exchange Binance, however, the deal ultimately fell through while Binance’s due diligence on FTX’s balance sheet was still pending.
Binance founder, Changpeng Zhao, announced the deal would be terminated after concluding this due diligence phase and deemed the rival’s problems were beyond their ability to salvage. When the deal was called off, chaos ensued, again, and ended with FTX announcing that it would file for bankruptcy and wrap up operations.
The hype around this exchange was at a fever pitch, leading the exchange to spend $20 million dollars on an ad campaign starring the likes of Tom Brady and his supermodel wife Gisele Bündche, who were also early investors in the company.
Fast forward to now, and the debacle has devolved into the founder of FTX fleeing to the Bahamas, presumably in an attempt to escape any kind of legal repercussions and investors, as well as users are left with more questions than answers.
One of the biggest questions that has surrounded the implications this could have on the cryptocurrency market more broadly. This scandal has left the market and investors reeling, causing a further collapse of some of the biggest coins out there, including Bitcoin, which has seen a decline all the way down to just over $16,000 per coin.
You will recall that just one year ago, Bitcoin was trading well over $60,000. So the question as to what’s next is a valid one. The harsh reality, no one really knows. Of course, you still have the diehards who believe this is merely a bump in the road for cryptocurrency where the alt-coins may die out, but the mainstays like Bitcoin and Ethereum will remain. Then you have the skeptics who believe this was the final nail in the coffin.
Whatever side you find yourself aligned with, there is a way to act on your belief, either for the long term, or simply to make a few bucks while the dust settles. Let’s take a look at both the bullish and bearish options below.
Whether you want to go long because you think these are great prices to get in on crypto or you want to go short in the case the carnage isn’t over, Magnifi makes access to either strategy not only possible, but easier than ever before.
This time around, there really is no excuse for you missing out on whatever opportunity you see before you. All you need to do is decide which side of the coin you find yourself.