FTX and the Integrity of the Cryptocurrency Markets

foreign casting live late at night from Toronto Ontario I'm here in town for the Bri's annual Summit I was invited to speak and I'll be speaking tomorrow but as many of you notice that there's a lot of stuff going on right now in the markets and everything's kind of a unique place and so I figured I'd make a video before I went to bed even though it's quite late here it's almost one o'clock in the morning it's about 12 30 of what we know what's going on so FTX is a major Financial player and they do a little bit of everything a little bit of the money transmission stuff a little bit of the market making stuff a little bit the trading stuff and they were led by Sam Brinkman feed and SPF as we all call them in the industry was recently going on a tycoon search throughout this year he made or attempted to make many high-profile Acquisitions the Voyager acquisition for example now Sam on paper apparently was worth quite a bit of money it was a Deca billionaire so technically had assets over 10 billion dollars and the books of his organizations cumulatively were over that much as well it looks like what's occurred is that FTX was through a series of transitive relationships closer to what occurred with Luna than people led on so Luna as many of when it collapsed created a cascading series of failures for things like three arrows Capital and others and it's created an enormous amount of instability in the market that the market is still attempting to digest there's an asset called Alameda that had a relationship with FTX and that asset apparently got a bit too much value and it's created a liquidity problem for Sam's Empire and it may be the case that and more will be discovered soon that he's insolvent and as a result requires a bailout for acquisition basically a shotgun wedding to continue operations and if it doesn't get that bailout that there's a good possibility that his FTX will go out of business it'll get liquidated much in these things tends to get discovered so binance has made an offer they've signed a non-binding letter of intent based upon due diligence and as due diligence is done oftentimes things are discovered in uncomfortable things especially the relationship financially speaking of the founders to the entities as well as how funds were used and how much risk exists within the entities there is a non-zero probability that the acquisition proposal that binance is put on the table to bail out FTX to acquire it will not succeed because it will fail due diligence this is often the case in many distressed assets that when people look at them they discover that they're far more distressed than they thought if that's the case because of the size and scale of FTX it's very likely that that will Cascade through the cryptocurrency market now my firm we had no involvement exposure or connection to any of these things so we didn't lose any money cardano doesn't have any gaps or defy that really touched anything related to the Luna ecosystem or the yield products that were very popular but highly unstable in the ethereum ecosystem so effectively speaking this does not directly impact the cardano ecosystem but as members of the broader cryptocurrency space this will likely cause issues for all of us in particular there is the case that SP that FTX has been lobbying very heavily in Washington DC their failure could change the political landscape in unpredictable ways it was my belief and that a red wave would occur today and in early indications of the election are that that is the case with just to the magnitude of it and based upon that magnitude it was my belief that legislation would pass that would be inspired from things the statnow proposal from the U.