What will happen to Bitcoin and other cryptocurrencies next

Before the event, many rumours and fakes appeared on the internet. One of them stated that already former billionaire and FTX founder Sam Bankman-Fried had allegedly managed to leave the Bahamas in his own private jet. As it turned out, this was unconfirmed information.

FTX CEO Sam Bankman-Fried at a congressional meeting

The FTX collapse itself began with the leaking of the Alameda Research financial report, which highlighted the hole in the company’s budget and its precarious position in general. The situation got out of hand when Binance chief Changpen Zhao announced the sale of FTT’s native token from FTX from its exchange reserves. Zhao later announced the possibility of buying FTX, but then cancelled the deal, causing the market to collapse even further.

The actions of Bankman-Fried and his team have come under heavy criticism from the cryptocurrency conference scene. Mexican exchange compliance director Felipe Vallejo made the following statement in an exclusive interview with Decrypt

We think we know what happened, thanks to third parties and Twitter. I feel very sorry for the people who lost money – I don’t want to make a value judgment until we see the facts.

LaBitcoinConf 2022

He added that his exchange has always prioritised customer safety and trust, sometimes even at the expense of its own growth. Vallejo’s comment echoed what Coinbase founder and CEO Brian Armstrong said earlier last week. As a reminder, Armstrong said at the time that what happened to FTX would bring the crypto industry under stricter regulatory scrutiny.

Mario Iemma, operations manager for BitGet’s Latin America and Spain platform in Singapore, believes the crisis could be an opportunity. His exchange, which leads the region in derivatives trading volumes, has announced a new system that allows users to control its liquidity at all times. The idea is to increase transparency, which in turn will lead to wider acceptance of crypto.

Bloomberg has written Bankman-Fried out of billionaires

And the CEO of cryptocurrency company Koibanx, Leo Eldwayen, suggested that platforms like FTX or Celsius should be “ignored” altogether. According to him, they are not a real part of the Web3 world. However, this will not make the affected investors feel better. On the contrary, what happened to FTX and Celsius should be carefully analysed so that similar events do not happen in the future.

An even more provocative statement was made by Jimmy Song, a popular Influencer and Bitcoin maximizer, shifting some of the responsibility for what happened to users.

In fact, the crux of the matter is that people trusted FTX and FTX ditched customers. At Bitcoin we preach the following: check – don’t trust. Once you trust someone, you give them power.

Vitalik Buterin has also made his statement.

There are things that fail because they are inherently bad. And there are things that fail because there is no trust in the model at all, and there is trust in one guy.

Etherium creator Vitalik Buterin

Buterin’s clear implication is that most crypto-enthusiasts simply didn’t believe in the possible collapse of Bankman-Freed. He had the image of a slightly wacky genius who managed to make it onto Forbes’ list of youngest billionaires. As we can see, much of his success is due to manipulation and even plain luck.

In general, many influencers in the crypto industry immediately tried to reassure the public after the FTX crypto exchange went bust: after all, the collapse of one trading platform will have no impact on the long-term sustainability of Bitcoin and other coins. El Salvador’s President Nayib Bukele has joined their ranks. Bitcoin became official tender in the country last year, with the Salvadoran government also actively buying BTC into the national reserve. As such, it comes as no surprise that Bukele continues to support the digital asset industry.

Is Bitcoin worth buying?

Buquele is still criticised for his Bitcoin maximalism, as the accumulation of over a hundred million dollars in BTC in the country’s reserves has led to unrealised losses for its budget. Nevertheless, the president sees the difference between FTX’s problems and the major cryptocurrency. Here’s his recent Twitter post, cited by Cointelegraph.

FTX is the exact opposite of Bitcoin. The Bitcoin protocol was created to prevent financial pyramids, bankruptcies, and anything resembling the WorldCom, Bernard Madoff, Sam Bankman-Friede case, emergency payouts and wealth redistribution. Some people realise this, others don’t yet. We are still among the former.

El Salvador’s President Nayib Bukele

In his message, the president referred to the many fraudulent and simply flawed financial schemes that have led to widespread crises. All of this can be countered by Bitcoin, as it creates a decentralised, peer-to-peer payment network that does not require participants to trust it.

Note that in this case BTC was also traded on FTX and was in no way immune to fraudulent transactions. Rather, Bukela should have praised the decentralised finance industry, in which loan systems and other transactions are fully transparent. However, he is constrained by his own Bitcoin position and therefore ignores DeFi and everything else.

The current market situation is no consolation for investors affected by the FTX collapse. Fortunately, the issue of cryptocurrency recovery has been promised by Changpen Zhao, CEO of Binance. According to Decrypt, the day before he announced the creation of a fund to “rebuild the crypto industry”. Here’s the cue.

To mitigate further negative effects of the FTX collapse, Binance is forming an industry recovery fund to help projects that are generally strong but are experiencing a liquidity crisis.

Zhao’s announcement on the creation of the fund

He added that more details on the initiative would be announced soon, and encouraged projects that seemed to “qualify” to contact Binance Labs. The Binance chief also noted that “other industry players with cash” could participate in co-investing in the fund.


All in all, it's a commendable initiative that could stop a cascade of bankruptcies at other companies closely tied to FTX and a Bancman-Frieda trading company called Alameda Research. Zhao himself emerges victorious from this situation as he will now gain a reputation as the "saviour" of all other investors.

The main thing now is for market participants and people outside the market to take the news and tone down their own pessimism a bit. Obviously, this is not the end of the story and the development of the digital asset industry as a whole.

What do you think about it? Share your opinion in our Millionaire Crypto Chat. There, discuss other important developments from the blockchain world.

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