Is FTX Just An Excuse To Crash Markets?
Really funny to me how the timing of all this with FTX is coming around. When you turn on the talking heads on the financial news sites, it's all FTX, SBF, and trying to tie the entire space into this exchange crash. Let's not forget that the latest CPI numbers are getting ready to come out.
Trading right now is extremely dangerous, but if you can play the volatility, then have at it, it's all there for you. I had a couple of good wins yesterday, but at this point, technical analysis is out the door until all of this calms down. I am sitting on the sidelines waiting and trying to rebuild my account with some other earnings before I jump back in. What is crazy is that ALL assets, even if they had anything to do with FTX or not, like HIVE, are tanking.
All Markets Making Moves
It's not just the crypto markets that have been moving during all of this, the stock market and commodities market have been on a massive downslide as well. But you are not hearing about any other macro issues aside from the same ole same ole that would be causing those markets to crash. All I am hearing the last couple of days is FTX, FTX, and more FTX. Makes you wonder what is really going on in the background.
The media is using this opportunity as a weapon to attack the industry as a whole. At the same time of the reporting, the DXY took a dump and basically the entire market pumps. CPI data was allot lighter than the market was expecting so prices of most assets started to rip.
Is this all just market manipulation by market makers and institutions and using FTX as the 'face' of the crash? Not likely, because Meta and Twitter are both laying off employees in droves. The economy is in shambles, but you know... It's fine...
Bail Out Offers Line Up
As we all know, CZ and Binance was the first in line to try and bail out the Bankman and his cronies, but at one big look at the internals, CZ ran for the hills.
Next up is our good ole buddy, Justin Sun with an offer to 'save crypto'. Yeah, we all know how that would work out. We have all been on the losing end of his little stick. But funny how TRX on FTX ran up over 4,000%.
I have also seen reports on Twitter about Huobi also lining up with an offer to try and bail out the failing exchange.
Leveraging User Funds
This is a move that we have seen from centralized exchanges many times. They use user funds to either lever up their business to do their own trading or investing, or in the case of the STEEM/HIVE fork with our foe, Justin Sun, he had centralized exchanges use user funds to stake and attack the chain. Supposedly the exchanges didn't know what was going on, which we all know is a bunch of bull.
Haven't we learned with the downfall of multiple over-levered companies like Three Arrows Capital, Celsius, and Voyager? What is worse is that FTX is trying to be the 'face' of the industry with sponsoring just about every US sport, their name on the Miami Heat Arena, the logo on every MLB umpire, and more.
SBF Has Always Been A Shady Player
Bankman has always been a bad player in the space if you ask me. He is constantly promoting regulation, all while completely screwing over his users and investors by pulling the same stuff he is trying to get put under regulations! Really?
What can you expect from someone with that kind of influence and pull that won't even go and get a haircut or put on some decent clothes? If you are managing billions like that, you should probably look the part. But that is just my opinion. Heck I have even been cleaning up my look lately just to put myself in a more successful mindset.
Regulation Is Only Going To Increase
Being that SBF was one of the biggest voices in favor of regulation, to the point of backing a national bit license that would basically make it illegal for people in the US to even make peer-to-peer transactions. But after his exchange is basically going insolvent, that is only going to get the regulators more on the warpath.
Gary Gensler, the chairman of the US SEC, came out this morning on CSNBC and stated they are going to be investigating the FTX fiasco, and that they are continuing their path to increasing regulation to 'protect consumers'. Which in this case, the investors need to be looked after. Most of these centralized exchanges are unregulated and are doing bad things with YOUR money. Coinbase is different as they are a publicly traded company so they by regulation have to be transparent. FTX on the other hand, is not, so they are not bound by the same rules as Coinbase. But Coinbase gives the government user information, so really you can't trust anyone.
Use DEXs To Trade
The best bet is to use decentralized exchanges to do your trading. There are many of them out there where the users are providing liquidity and everything is on the blockchain. I have been leverage trading on Apollo X on BSC, but when DYDX goes to their own Cosmos based chain, I will be trading there. One issue I have with Apollo X is the lack of liquidity. So there are issues with that as well. I may just be going back to trading spot for a while, lol.
Not Your Keys Not Your Coins
When you have exchanges that halt withdrawals, this is a huge reminder that they hold your crypto, so therefore, it's really theirs to do with what they want. It's no different than a bank. So if you can use DEXs instead of the centralized exchanges to make your swaps, you are much better off because you control the funds.
Until next time everyone, be safe out there in these crazy markets and...
Be Cool, Be Real, and Always Abide
Nothing said is financial advice.
This is for educational and recreational purposes only!
Stay safe in these volatile markets and don’t get rekt!
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