PayBitoPro’s Chief Raj Chowdhury foresaw FTX crash

Exchange crashes, terra fallout, and fluctuating markets led to a series of shock waves in the crypto industry in 2022. The FTX crash was debated as the biggest crypto disaster in terms of loss of capital and lacks a consequence professional to its magnitude. PayBitoPro chief, Raj Chowdhury articulated his displeasure with the poor mismanagement of investor assets that led to the FTX misspending its $ 32 billion wealth to ultimate bankruptcy. He further added that the impact of the single incident will not reflect in other crypto companies and exchanges.

The FTX Scandal and the Misuse of Client Assets

Sam Bankman Fried was accused of utilizing the assets of clients and lending them to risky trading bets before the FTX collapse news was flashed before the public. The lack of a crypto regulatory framework authorized access for the FTX exchange to these assets, along with the long-term embezzlement only made the situation worse. SBF once made a career in crypto trading, however, misutilization of the assets eventually led to its downfall.

Exchanges like Coinbase or PayBitoPro segregate and safeguard the assets of investors. It will never deal with the issues of FTX. Charges on Sam Bankman Fried with crypto fraud for transferring assets along with customer funds. Above $4 billion to his sister trading company, Alameda Research. It possesses assets including several illiquid altcoins, aligned with the native token of FTX, FTT. The matter worsened, as the hackers attacked the exchange and stole $447 million.

CEO Speaks

The Chief of PayBitoPro, Raj Chowdhury states “FTX collapse was a cautious stable movement. It is not a surprise that these companies are falling apart.”

He has previously acknowledged the need to improve security in crypto ventures. He highlights the importance of education and awareness to prevent the public from falling into the trap of scammers.

FTX Owes Money to Over 1 Million Creditors

Sam Bankman Fried, the CEO of FTX was charged by US federal prosecutors with 8 counts after his arrest, which include money laundering, financial crimes, and fraud. The CEO is continuing to plead not guilty. However, the exchange still owes money to more than one million creditors, and they contributed to an $8 billion loss for the customers. Based in the Bahamas, FTX has previously filed for chapter 11 bankruptcy.

Final Words

 The Securities and Exchange Commission plans to launch an investigation into the FTX collapse. That too with Gary Gensler, the SEC chair reiterating the need for safety measures for the assets of investors. Therefore, a special task force by US FED  looks for traces of the stolen assets of FTX. The existing crypto laws lack clarity which forced the businesses to transfer their trading operations offshore. To standardize the framework, and restore investor confidence, there is a need for crypto regulations in the industry.

Source: https://finance.yahoo.com/news/ftx-crash-expected-coming-says-080000433.html