FTX Collapse
Worst crypto bankruptcy of 2022 — Sam Bankman-Fried, $32 billion gone, 1M victims.
The FTX collapse (November 2022) is one of the biggest financial frauds in history — a $32 billion exchange gone in less than a week.
What happened:
•FTX was the third largest exchange by volume, considered "safe"
•Sam Bankman-Fried (SBF) — CEO, public face, donated hundreds of millions to Democrats
•In secret: FTX lent $10 billion in user funds to its hedge fund Alameda Research
•Alameda used those funds for bad investments and luxury
•November 2022: Binance announced FTT token sale → panic
•Users tried to withdraw $6 billion in 72h — FTX didn't have the money
•Bankruptcy, SBF arrested, sentenced to 25 years in prison
Consequences:
•1M+ users lost access to funds
•$8+ billion in user funds gone
•BTC fell to $15,500
•Celsius, BlockFi, Voyager — domino effect
Lesson:
•"Not your keys, not your coins" — if crypto isn't in your wallet, you don't own it
•Even "trustworthy" centralized exchanges can fail
•Diversify between exchanges or use non-custodial solutions