FTX’s Crash Might Be the Last Crisis for Digital Assets Space: Cardano Founder.
Cardano founder Charles Hoskinson believes the FTX crash might be among the last crises to hit the digital assets space. He said such incidents are getting complex because of the ripple effects on other players in the ecosystem.
Hoskinson says the downward spiraling cycle might be coming to an end. He highlighted that the implication of FTX collapse would mirror market events that followed the Terra (LUNA) ecosystem crash that resulted in cascading effects on numerous companies like Three Arrows Capital (3AC) and the now-bankrupted Celsius Network.
The Cardano boss believes this might be the bottom – one of the last ones to deal with. However, he says it will be hard to predict how bad it will be as it could certainly potentially be very bad. Hoskinson said there are not many more firms that were like Sam Bankman-Fried’s FTX, or Alameda, or like the 3AC, and so forth. He hopes that this is the last cycle of this nature.
He said FTX’s collapse is an impact of the general crypto market “excesses” of 2021. Hoskinson pointed out that he had repeatedly warned people about the excesses in 2021 and all throughout this year too. He said one doesn’t get something for anything in extremely high yield as it tends to evaporate very quickly. In regards to Binance acquiring FTX, the Cardano founder said it’s not a silver bullet. He believes much work is needed.
Hoskinson feels that situations like this invite litigation and regulation, as well as enormous scrutiny.