The fortunes of FTX exchange and its founder Sam Bankman-Fried hit a dead end this week after falling from glory. FTX is on the edge of insolvency and SBF lost nearly 94% of this wealth in less than three days.
The once ‘crypto genius’ SBF’s net worth plunged $14.5 billion on Wednesday after Binance backed out from acquiring his exchange. FTT token is down 50% on Thursday falling from $25 to $2.05 this week. If these many cocktails of bad news weren’t enough, the Bloomberg Wealth Index published a report that FTX’s valuation could be $1.
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The Bloomberg Wealth Index report “assumes” that SBF and the existing FTX investors will be wiped out soon after Binance’s bailout. FTX, the once $32 billion in valuation company is valued at $1 by Bloomberg.
In their explanation of the $1 valuation for the FTX exchange, Bloomberg said in their latest report,
Also Read: Shiba Inu Ecosystem Collapses 60% During the Crypto Crash
“The Bloomberg wealth index assumes existing FTX investors, including Bankman-Fried, will be completely wiped out by Binance’s bailout, and that the root of the exchange’s problems stemmed from Alameda”.
They continued, “As a result, both FTX and Alameda are given a $1 value”.
“That leaves SBF’s net worth at about $1 billion, down from $15.6 billion heading into Tuesday. The 94% loss is the biggest one-day collapse ever among billionaires tracked by Bloomberg,” it read.
You can read more about the Bloomberg Wealth Index valuation of the FTX crypto exchange being placed at $1 here.
FTX Bites the Dust in 2022
A series of unfortunate and shocking events rocked the crypto world in 2022. TerraUST and Luna crashed to $0 in May giving investors the jitters. The fall led to the insolvency of several crypto lending firms such as Three Arrows Capital, and Voyager Digital.
In addition, Celsius Network and Babel Finance also went bankrupt, and a handful of exchanges had previously halted withdrawals.
FTX is the latest to be added to the list of insolvent crypto firms in 2022. The bear markets have been harsh and cruel decimating a handful of crypto exchanges and lending firms. How many more victims will the bear markets wipe out in 2023 and beyond, only time will tell.
Also Read: Crypto Carnage: How Much Value Did the Markets Lose 24 Hours?