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While some believe the FTX collapse is the straw that breaks crypto, others say it will strengthen the industry in the long run.
Is it just a huge road bump as the world moves to web3, or the cliff’s edge for the industry as we know it?
On November 12, A&T Capital hosted a Twitter Space featuring Footprint Analytics, Huobi Incubator, and Transcrypto News to explore the FTX event’s effect on crypto and blockchain.
Here are the key takeaways.
What just happened to the crypto market?
- Whereas the industry was built on trusting the code, the fast growth of crypto has necessitated centralized exchanges. We don’t have any trust mechanisms on centralized exchanges.
- In the short and mid-term, the market conditions will be difficult. However, this kind of crisis was necessary to rethink the industry in the long run in a healthy way, as there are massive underlying problems.
“This is a good lesson for ourselves and the crypto market that there is nothing too big to fall in this market. People will rethink the way to keep their wealth safe, and the institutions will rethink the more proper way to participate in this industry. I don’t see that in the next two quarters, any big investors or VCs will pass the ICO of any big web3 project.” – Vandescent, Huobi Incubator
What kind of regulations will the FTX collapse usher?
- The crypto industry is in a grey zone. Even though we’re decentralized, it’s now clear that we need a third party to provide more safety solutions and regulations. It’s a delicate balance—how can we help the industry develop while having mechanisms that show we’re capable of handling people’s wealth?
- From the beginning of the crisis, SBF never thought about how to repay his users—only how to secure his own assets. There’s no way to clean up this mess.
“People will find that the FTX issue is not just about the billions in liquidity pulling away temporarily; it is about the ‘liquidity’ called trust pulling away permanently. That needs a long time to recover.” – Vandescent, Huobi Incubator
“The giants like Binance and others should think together about a solution. It’s our industry’s mess. Even though Binance has already backed out of the rescue, as long as we want to gain more users in the long term, we shouldn’t just leave the exchange on the brink of collapse. Everyone in this industry should make an emergency organization to support [the users] how they can.” – Transcrypto
Why did Binance abandon its takeover deal, and is it good for crypto?
- CZ was already not a fan of FTX regarding what happened before the collapse fiasco. And after it, it’s definitely not a good deal.
“From an analytics point of view, Binance said it would take months for them to liquidate the funds even if they can do it—it’s just not worth it for CZ to acquire FTX. The silver lining is that it does give the industry a reason to think outside the box. If it didn’t collapse now, the amount of money in five years that could have collapsed would have been much more. But how do we gain back trust? […] Right now things are too chaotic to think of a solution.” – Alex, Footprint Analytics
This piece is contributed by Footprint Analytics community.
Footprint Analytics is building blockchain’s most comprehensive data analysis infrastructure with tools to help developers, analysts, and investors get unrivaled GameFi, DeFi, and NFT insights. The engine indexes, cleans and abstracts data from 19 chains and counting—letting users build charts and dashboards without code using a drag-and-drop interface as well as with SQL or Python.
Footprint Analytics also provides a unified data API for NFTs, GameFi, and DeFi across all major chain ecosystems.
The post Does the FTX collapse really have a silver lining? appeared first on CryptoSlate.
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