11 November 2022: FTX files for bankruptcy
FTX, once valued at around $32 billion and promoted by celebrities and sports stadiums, filed for Chapter 11 bankruptcy, and founder Sam Bankman-Fried resigned as chief executive. Customer money had been funneled to affiliated trading firm Alameda Research. The FTT token, used inside the exchange, had already collapsed. Investors who trusted big-name backers learned that famous venture capital firms can do sloppy due diligence too.
The lesson: Famous backers are not an audit; verify how your money is actually held.
What it meant for investors
$1,000 in FTX Token at the start of 2020 → $0 today, vs $2,092 in the S&P 500.
We start the clock at the start of 2020, the latest year on the wheel. FTX Token went to zero, so the position is worth nothing at all; the index turned the same money into $2,092.
What FTX Token teaches: When a token's largest holder and borrower is its own issuer, its value is circular; collateral consisting of your own token is not really collateral.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2020 | $2.00 | $0 | $2,092 |
green = beat the S&P 500 · red = lost money
What if you bought FTX Token? Every starting year and the full story →
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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