“Cryptocurrency…largely a scam”
(NewsNation) – As the first of what is expected to be several lawsuits over the collapse of cryptocurrency exchange FTX have now been filed in court, Kurt Wuckert, Jr., chief bitcoin historian at CoinGeek.com, joined “NewsNation Live” on Monday to discuss the implications.
Of his many insights, Wuckert Jr.’s assessment of the crypto-economy as a whole, calling it “pretty much a scam,” was telling, especially since he is an entrepreneur with experience in business management and cybersecurity.
“I’m a proponent of blockchain technology and bitcoin myself, but the way it’s being used for almost nothing but fundraising schemes and this kind of nonsense makes us all look bad,” Wuckert Jr. said.
“So, in my opinion, the removal of FTX and some of their partners … could provide an opportunity for people to stop thinking of it as purely an investment and actually look at what the underlying technology can do for the business. And I think it is a very important step to take.”
It’s been an epic fall from grace for the company once seen by many as a can’t-miss investment. FTX’s founder, Sam Bankman-Fried, was even compared to Warren Buffett by Forbes at one point.
But the company filed for bankruptcy protection on Nov. 11 in Delaware, leaving its estimated one million customers and investors with heavy losses. FTX says it owes $3 billion now to its top 50 creditors.
In addition, the Ministry of Justice and the Securities and Exchange Committee are now investigating the currency exchange. And the authorities in the Bahamas, where FTX is based, are also looking into what led to the company’s bankruptcy.
“Well, it means a lot of things: The space has struggled with a professionalism problem for a long time, and I think FTX shows that whatever facade was put on top of it is really just a real problem,” Wuckert Jr. so.
“It’s a massive creditor — everyone from mom and pop all the way up to some of the biggest firms in New York and California — and the implications are going to be broad. I would venture to guess that we’re not actually seeing the full extent of this thing before a year or two as this is being phased out.”
Wuckert Jr. also talked about whether Sam Bankman-Fried, the former FTX boss, could face charges.
“It’s starting to look that way. Some of this at first looked like incompetence. But more and more it looks more and more like a concerted effort to hide funds.
“These alleged hackings and things that are happening, so convenient that a hacker was able to leak right while they were under investigation. There is also a small indication that the Bahamian officials may be involved, although this is pure speculation the time.
Check out the full interview above.
