Polygon CSO Predicts The Future Of FTX
- Mudit Gupta, the Chief Security Officer of Polygon (MATIC), stated that the customers of crypto exchange FTX and it’s sister firm Alameda Research are “rekt.”
- He predicted that the venture arm of FTX crypto exchange, FTX Ventures, is also not safe and that Alameda and FTX Ventures might initiated a selling event in the crypto space, expanding the crypto winter.
- Many firms who had their moeny stuck in FTX will be forced to cut costs, let people go, and do down rounds. Also, the Polygon CSO predicted that “valuations and salaries are going come down.”
The CEO of Binance, Changpeng Zhao, confirmed that his firm is considering acquiring rival exchange FTX, led by Sam Bankman-Fried, but only after a strict evaluation of its balance sheet; if the situation is not good as per Zhao’s evaluation, Binance will drop the acquisition deal.
In response to the entire Sam Bankman-Fried and Zhao situation, the Chief Security Officer of Polygon (MATIC), and Ethereum scaling solution, Mudit Gupta, has predicted that FTX customers and Alameda, the sister of firm of the exchange, are “rekt,” i.e., they are in potential losses and their funds are not safe anymore.
According to the Polygon CSO, Alameda Research might have to liquidate their positions so their liquid holdings like FTT, Sol, Crv, Uni, Sushi etc. may have a hard time. These tokens were purchase by Alameda which used to actively trade them on markets to gain profit. If the sister firm of FTX established by Bankman-Fried himself, goes out of business or sells its assets, it is clear that there might be additional selling pressure that could be put on the crypto market.
The venture arm of FTX crypto exchange, FTX Ventures, is also not safe and the relationship between the two firms might be thrown off balance, stated the Polygon executive.
“FTX ventures <> FTX relationship may cause the ventures arm to liquidate their holdings. Their investments like Near and Aptos may struggle. Investors of FTX will have a hard time but unless they were degen too, they should be fine,” Gupta stated in another Twitter post.
As noted by Gupta, many projects had their treasuries on FTX and as per earlier reports, event the third largest pension fund in Canada, the Ontario Teachers’ Pension Plan, made a big crypto investment in the world’s third largest crypto exchange which it will now have to write off. These firms that had their money tied to FTX will not see their money returned to them anytime soon which means that they will be forced to cut costs, let people go, and do down rounds. Also, the Polygon CSO predicted that “valuations and salaries are going come down.”
“Regulators will use this as an excuse to tighten their grips on Crypto companies, forcing more companies to move outside the big jurisdictions. Lot of retail will get rekt and that’ll turn the already bearish market sentiment even more bearish,” predicted Gupta.
The Polygon executive warned crypto investors to brace for the extension of the crypto winter adding that “it’s gonna be harsh.” He also stated that it is once again the time to “focus on building” but reaffirmed investors by stating that the industry will make a comeback soon.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
