Last week the public heard the news about a sudden collapse of FTX, one of the biggest crypto-currency exchange. The investors lost their money, and the investor confidence in the crypto-asset market dropped again. The question is whether investments in digital assets and currencies that are still outside the national supervisory system can ever attract investors in the future.
The consequences of the crypto exchange’s collapse are compared to the consequences of the failure of Lehman Brothers in 2007, which became a symbol of an emerging global financial crisis. Importantly though, the bank held 600 billion dollars in assets, which, once cashed out, could cover some of the liabilities. Meanwhile FTX held assets invested in another, non-liquid crypto-currency FTT. The tokens have no value reflected in any other currency (e.g. in U.S. dollars) or their value is very low.
The Polish Financial Supervisory Authority warns about the risks arising from acquisition of and trading in broadly defined crypto-currencies:
https://www.knf.gov.pl/knf/pl/komponenty/img/Ostrzezenie_UKNF_o_ryzykach_zwiazanych_z_nabywaniem_oraz_z_obrotem_kryptoaktywami_72241.pdf