In the world of cryptocurrency, losing millions of dollars in a collapsed platform like FTX is a devastating blow. However, some investors and users are not completely discouraged and still believe in the potential of cryptocurrencies. Despite the fact that they have not recovered their funds, many individuals are planning to continue investing in the crypto sector, as reported by CNBC.
One such believer is Evan Luthra, an app developer who lost a staggering $2 million in FTX’s multi-billion dollar implosion last year. Even though he knows he won’t have access to his money for several years due to FTX’s bankruptcy, Luthra continues to speak at crypto conferences and remains confident in the value and usefulness of bitcoin and cryptocurrencies.
Luthra states, “The mistake here was not bitcoin, the mistake was not crypto… The fundamental reason why we buy bitcoin, why we use bitcoin has not changed.” His words highlight the fact that FTX’s collapse was not an indication of a crypto failure but rather a result of traditional fraud and mismanagement within the platform.
This sentiment was also expressed by Hanna Halaburda, an associate professor at NYU’s Stern School of Business, in a conversation with PYMNTS after FTX’s demise last year. Halaburda explained that using FTX’s failure to condemn the entire cryptocurrency market as a scam was a misguided approach. She emphasized that FTX’s downfall was not caused by problems inherent in cryptocurrencies but rather by illegal activities such as stealing and lying, activities which are already illegal regardless of the industry.
One of the FTX customers mentioned in the CNBC report, Jake Thacker, lost hundreds of thousands of dollars when FTX folded, adding to his financial woes after losing his job in the tech industry. Despite his current predicament, he still encourages people to invest in cryptocurrency. However, he advises them to be cautious and learn from his mistakes, stating, “Here’s what I learned, don’t make the same mistakes I did.”
The documentary by CNBC coincides with the start of FTX founder Sam Bankman-Fried’s criminal trial, scheduled to begin in federal court in Manhattan. This trial is expected to shed more light on the allegations against Bankman-Fried and may involve testimony from FTX customers, investors, and former executives. Prosecutors are aiming to demonstrate that Bankman-Fried orchestrated one of the largest white-collar crimes in U.S. history.
While the collapse of FTX was a major setback for many individuals, it is important to remember that this incident should not be used as a blanket condemnation of the entire cryptocurrency market. As with any investment, caution, due diligence, and awareness of potential risks are essential. While some investors remain optimistic about the future of cryptocurrencies, it is crucial to learn from past mistakes and ensure that measures are in place to prevent fraudulent activities within the industry.