In January 2022, Sam Bankman-Fried was riding high. His Bahamas-based FTX had just raised $400 million from prominent venture capitalists at a $32 billion valuation. A few weeks later, when Forbes published its annual World’s Billionaires list, SBF, as he’s known, was crypto’s second-wealthiest person, worth $24 billion. Now, Bankman-Fried is likely broke, and awaiting trial. Before he was arrested in the Bahamas, SBF told several media outlets his bank account was down to $100,000, and that he was “not sure” how he’ll pay his lawyers. Gary Wang, FTX’s other cofounder and the company’s former chief technology officer–who entered a plea deal with the Securities and Exchange Commission–has also seen his fortune, once estimated at $5.9 billion, wiped. FTX’s demise was a fitting end to a year of wealth destruction in the cryptocurrency and blockchain sector. The post-pandemic economic shock, which triggered inflation and rising interest rates, sucked capital out of the speculative crypto ecosystem. Prominent firms imploded, from the $40 billion collapse in May of algorithmic stablecoin TerraUSD, to the crypto hedge fund Three Arrows (which declared for bankruptcy in July), to the bankruptcies of interest-bearing lending businesses Voyager Digital, Celsius and BlockFi. Bitcoin, the largest cryptocurrency and an industry bellwether, is down 65% from its $69,000 peak in November 2021. Meanwhile some $2 trillion of market value has fled digital assets for safer pastures.
Full story : These Crypto Founders And Bitcoin Moguls Lost $116 Billion In 2022.
