Following the crisis in FTX, the company’s CEO, Sam Bankman-Fried (SBF), has been trying to salvage the exchange. He has been gathering resources and funds from other subsidiaries and SBF-owned companies like Alameda to support FTX.
FTX crypto exchange has been struggling recently due to liquidity issues. As a result, the firm is gradually sinking as its reserve balances keep moving to the south. Also, the native token, FTT, has lost over 20% of its value within a few days.
The trauma on FTX is linked to the unfolding drama with Binance, another giant crypto exchange. Some days ago, the CEO of Binance, Changpeng Zhao (CZ), announced that the firm would soon liquidate all its FTT holdings. This created a crack for FTX, and its token started going down the next day.
Sam Bankman-Fried Drops In Bloomberg’s Wealth Index
The entire event has cut down the net worth of crypto billionaire SBF. According to Bloomberg Billionaire Index, SBF suddenly lost about 94% of its wealth. This massive drop removes the privilege of being called a ‘billionaire.’
Before now, Bloomberg’s wealth index placed SBF as a high rider in wealth. It recorded an estimated peak of $26 billion as its net worth. But Bankman-Fried has now fallen below the top 500 billionaires in the index.
Bloomberg’s report on November 9 discussed the possible drainage of SBF’s fortune once the sale of his FTX exchange is completed. In addition, there have been rumors of Binance, the rival crypto exchange, vying for the buying offer.
Sam Bankman-Fried entered a liquidity crisis. The situation continued intensifying, requiring a potential bailout from any source. Subsequently, the CEO of Binance, CZ, opted to take over the FTX though the deal was inconclusive.
Wealth Crumbles Over A Single Day
SBF’s stake in FTX was 53%, worth about $6.2 billion. The entrepreneur also has ownership rights in Alameda Research worth $7.4 billion.
The assumption of the Bloomberg wealth index is flat out for both Sam Bankman-Fried (SBF) and other existing investors. According to Bloomberg, SBF is currently worth around $1 billion.
It noted that the entrepreneur dropped from $15.6 billion, representing the biggest single-day collapse in the Bloomberg records of billionaires.
Meanwhile, Binance has turned its back from a bailout agreement of its smaller rival FTX. According to Binance, following due diligence, it would not continue with the acquisition.
The US arm of the firm, FTX.US, is not part of the deal. Earlier in the year, this exchange branch was valued at $8 billion.
The FTX token, FTT, has been on a downward slide through the drama. The coin has lost over 94% of its ATH value since September 2021. At the time of writing, the price of FTT is trading at $2.18, depicting a drop of 72% over the past 24 hours.
featured Image From CNBC, Charts From Tradingview.com
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