The uncertainty within the crypto space continued to increase as FTX CEO, Sam Bankman-Fried (SBF), and Binance CEO, Changpeng Zhao (CZ) exchanged words on Twitter. The escapades led to an increase in uncertainty across the crypto space, hurting several cryptocurrencies. Earlier, the market took a hit after the rumors that SBF’s crypto exchange platform had liquidity problems, and FTT, the native digital token of FTX, took the greatest hit, losing close to 75% of its value and is currently trading at around $3.
A few minutes ago, Sam Bankman-Fried took to Twitter after a long silence to come clean to FTX.com users about the current situation as well as to explain the events leading to the mess up. According to the CEO, he messed up big time, and he takes full responsibility for the mess.
According to his tweet, SBF mentioned that he has made two major mistakes that led the trading firm to where it is right now. As he mentions, The first time he messed up is when there was poor internal labelling of bank-related accounts that led him to be substantially off on his sense of users’ margin. Sam Bankman-Fried, categorically stated that he thought the user’s margin was way lower.
According to him, he thought the Leverage was 0x while the USD liquidity ready to deliver was 24x the average daily withdrawals. However, in reality, the Leverage was at 1.7x while the Liquidity status was 0.8x of Sunday’s Withdrawals. On Sunday, the cryptocurrency exchange platform witnessed an unprecedented amount of withdrawals, to the tune of $5 billion. Which, according to SBF, was the highest volume of withdrawals by a large margin.
Despite the current crisis, the FTX CEO currently maintains that the situation only affects FTX International users and all US Based businesses are intact and fine.
In his recent tweet, FTX CEO expresses his regret for letting FTX.com users down a second time by not communicating properly. Besides, he mentions that his hands were tied and he could share little about the situation. “I Should have said more, I’m sorry”, he mentioned in his Tweet.
FTX CEO: What’s the way forward?
Several crypto investors are in a state of constant fear for their crypto investments. Sam Bankman mentioned that his number one priority is to protect FTX.com users right now. He says that he will do everything in his power to “do right by users”.
The Tweet is rather reassuring to FTX.com users who are currently helpless. The platform’s next cause of action is to raise liquidity. Although no reassurances are made, the FTX CEO says he will try his best to make it work.
Although the future is uncertain, Sam Bankman confirms that the fate of users, investors, and employees is dependent on the events that will happen in the coming weeks. He makes no reassurances but mentions that Alameda Research is winding down trading and that sooner or later, they won’t be trading on FTX.