Cryptos Plunge, Contagion Sweeps Across DeFi: Trying to Go to Heaven Together, End Up Going to Heck Together? | Wolf Street

So here we go again. Bitcoin has plunged into the $15,000 zip code, from $21,000 a couple of days ago, and from $68,000 a year ago. The FTX token, the native token of the Bahamas-based crypto exchange FTX, founded by Sam Bankman-Fried, has collapsed by 90% in two days. Cryptos across the board are getting crushed.

FTX is in a solvency crisis. Users pulled out nearly all of the 20,000 Bitcoins (about $430 million at the time, now a lot less) of the Bahamas-based crypto exchange in just four days, according to Bloomberg, citing data from CryptoQuant. Yesterday, FTX has halted withdrawals of cryptos.

ding founder and CEO Sam Bankman-Fried, Softbank Vision Fund, Singapore wealth fund Temasek, and Ontario Teachers’ Pension Plan.

Turns out that the fundamental principal in Decentralized Finance (DeFi) is that every firm must be deeply interconnected with other firms, each holding the other’s token, and lending to the other, and bidding up each other’s tokens, so that if one firm goes to heaven, they all go to heaven together – which they did – and when one firm goes to heck, they all go to heck together – which they’re now doing. Makes for very smooth and efficient contagion.

Cryptos Plunge, Contagion Sweeps Across DeFi: Trying to Go to Heaven Together, End Up Going to Heck Together? | Wolf Street

AGR has been warning readers about cryptos in general, for YEARS..