Jesse Powell: FTX Crisis is a Gift to Bitcoin Haters
- FTX is currently being investigated over how it handled its customers’ funds.
- Jesse Powell accused FTX of seeking favours from politicians and undertaking several deals that cost it.
- While he expressed optimism, Powell believes the industry will need years to recover from this event.
Former Kraken CEO and founder Jesse Powell has joined the growing list of crypto experts to air their views on the ongoing FTX liquidity crisis. In a post shared on Twitter, Powell expressed optimism, saying, “I know we’re going to get past this,” before adding, “this is a massive setback. I’m really trying to control my rage.”
In the long thread, Powell said the crypto industry is filled with “so many smart, passionate, open-minded, welcoming people, with genuine humanitarian interest at heart.” The former Kraken boss said true believers would not be deterred. Powell, however, cautioned that the crypto industry needs to raise its standards.
He launched into a rant that doesn’t specifically mention FTX or its CEO, Sam Bankman-Fried, but it is clear from numerous references that he has the struggling exchange and its management squarely in his sights. He wrote in one of his tweets,
This isn’t about aiming high and missing. This is about recklessness, greed, self-interest, hubris, sociopathic behavior that causes a person to risk all the hard-won progress this industry has earned over a decade, for their own personal gain. While already being rich AF.
Powell believes the contagion will spread, as it did a few months ago after Terra collapsed and set off a chain reaction of bankruptcies that cleared out platforms such as Voyager, Three Arrows Capital, Celsius, and a couple of other firms.
According to Powell, FTX’s decline gives critics a much-needed angle to attack the industry. He tweeted,
The damage here is huge. An exchange implosion of this magnitude is a gift to #bitcoin haters all over the world. It’s the excuse they were waiting for to justify whatever attack they’ve been keeping in their back pocket. We’re going to be working to undo this for years.
Powell, however, aimed his rant at other targets in addition to FTX and Bankman-Fried. He accused venture capital investment companies of funding companies without conducting adequate due diligence. Powell concluded his thread by listing many FTX-related issues that, in his opinion, should be cause for concern.
He accused SBF of “acting like you know everything after showing up for battle 8 years late.” Powell also claimed that SBF paid in 9 figures to gain political favours, which ultimately proved detrimental. Powell also took a dig at the collapsed exchange for its “huge ego purchase,” which includes several high-profile sports deals.
Powell also allocated blame to US legislators and authorities for FTX’s crisis. According to him, the authorities forced the business offshore, adding that all of this occurred due to the lack of an effective policy.
SBF’s FTX is reportedly being investigated by the US SEC and CFTC about its liquidity crisis. Authorities are concerned about how the exchange managed its users’ assets.
Several companies are looking at difficult times following their exposure to FTX.