Announcing the FTX collapse a month in advance, “Ishan Bhaidani” gives multiple warnings about what’s next.
He pulled all his money from the stock market a month ago and shorted FTX Token (FTT)
Bhaidani, a content manager at Web3 marketing agency Serotonin, shared on Twitter on October 5 that he has decided to start withdrawing funds from FTX and short-term FTT. Less than a month later, his prophecies all came true:
I get all my capital from FTX and short FTT. FTX wobbles and is missing on many activations all year long. Something dark is going on with FTX.
https://twitter.com/Ishanb22/status/1577699083808083969
Senior executives leaving
According to Bhaidani, the lineup of senior executives leaving FTX was a giant red flag. Alameda Research CEO Sam Trabucco announced his resignation on August 24. Then on September 27, FTX USA CEO Brett Harrison resigned. On October 3, it was reported that Jonathan Cheesman, head of over-the-counter and corporate sales at FTX, has resigned.
poor job performance
The researcher says it’s difficult to fully grasp the financial outlook for FTX. However, he managed to detect some problems. First, the trading volume of the exchange dropped significantly. It had regressed to December 2020 levels. It has reached levels not seen since the massive bull run began.
Lack of volume is directly related to lower income. This, combined with the growth of decentralized competitors like Gains Network and GMX, meant that the business could not be in its healthiest state. However, according to Bhaidani, FTX still continued to spend as follows:
- The FTX NFT market has received minimal attention, but it must have been a pretty expensive endeavor.
- They had recently agreed to a $212 million deal for the naming rights to the Miami Heat arena.
- FTX Ventures, the firm’s venture capital arm, has consistently made large, late-stage investments. Large check sizes to highly illiquid locations.
7. Bad Bull Market Decisions
They made the awful decision every degen makes during the bull.
Buy flashy things you probably shouldn’t.
Like paying $200M for naming rights to the Miami Heat Arena.
Bet they wish they could have this one back.https://t.co/zTzNoct5Dg
[11/20]
— Ishan B (@Ishanb22) October 5, 2022
FTX.US then launched FTX stocks to offer US investors a stock opportunity. According to Bhaidani, it seemed like a weak attempt to regain some of the revenues lost due to the reduction in volume.
What’s the next FTX case?
FTX’s bankruptcy was a deep stain on the cryptocurrency market as a whole. However, there is still much to be excited about, according to Bhaidani. We can take this as an opportunity to double down on the true ethos of this field—self-surveillance, minimizing trust, and the importance of unauthorized, open source access. In conclusion, according to Bhaidani, no matter how perfect all proposals may seem, one should never trust the surreal figures emerging from the crypto space. “Trust no one and verify,” the researcher says.
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