FTX went from an industry stalwart to shit since Monday night. Absolutely insane 3D chess by Binance CEO and just now hearing rumors SBF has filed for personal bankruptcy. His $16B net worth has just evaporated.
Tiger, Sequoia, Softbank, an Ontario pension fund, etc were in on FTX (among others like Tom Brady ofc) so I anticipate them to be deep in the red. I'm not even sure all of them will make it out alive.
Thoughts?
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Most of the firms/people you listed existed before crypto and have non-crypto business. I don’t think those necessarily need to go bankrupt with the crypto side if the crypto side definitely ends up going bankrupt completely
How much worse can things go for Tiger Global? Seems like nothing is going their way these days
Sequoia announced they are marking their FTX investment to $0
https://twitter.com/sequoia/status/1590522718650499073?s=46&t=jRRYDzXOi…
looks like ftx was a small part of a meaningfully profitable fund otherwise. Not sure if this write off changes much for sequoia
wsj says they raised $8bn for the fund. Ftx was $150mm of capital now valued at 0. Otherwise the fund seems to already be valued at like 2x with $7.5bn of gains
I won't be surprised if we see Margin Call 2 run with the FTX storyline.
Me and the other analysts were just researching and listening to the FTX drama today, and like you said it's been crazy. Can't even imagine what's going on in the mind of Bankman-Fried right now.
"uh oh, what am i going to do in jail??"
Saw in an article today that for the major backers of FTX latest round, the position was between 1 and 3% of one of their funds. Writing down $150mm is probably painful (makes me feel better about the couple hundred bucks I left in BlockFi) but if the entire fund is in the billions it’s not the end of the world.
not too familiar with crypto space, could someone explain how Binance is playing 3D chess here?
I guess they *were* playing it. Many, including me, thought that Binance had leaked/started rumors about FTX's fragility and caused the bank run. They then offered to buy FTX out, hence Binance would become the biggest and most powerful crypto exchange.
But they pulled out of the deal a day later and now it's recently come to light that Biinance - like FTX - holds a lot of their own token. So maybe they weren't really that much smarter than FTX and weren't playing 3D chess
https://www.bloomberg.com/news/articles/2022-11-11/binance-data-shows-4…
What will be interesting to see is what institutional(s) gets stuck holding the bag given billions of FTX's collateral was stolen customer money hidden via false accounting & heavily leveraged derivatives. This has to have some knock-on effects in the real markets over the next couple of weeks is my bet.
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