According to Mike Novogratz, CEO of the cryptocurrency investment firm Galaxy Digital, not all cryptocurrency exchanges are run like the now-defunct FTX.
Novogratz stated that not all cryptocurrency platform managers are out to steal users’ money in an interview with CNBC’s Squawk Box on December 15 and that not all crypto platforms are run similarly to how FTX was.
He said that regulators are attacking many exchanges for having frequently committed [know your customer/anti-money laundering] infractions. When they first began, they had nearly as effective safeguards against who was utilizing their exchange as they have today.
Policy Change Will See Better Prices
Meanwhile, Novogratz forecast that once policymakers finally had to loosen their stringent monetary and fiscal policies, the price of cryptocurrencies will rise. He further noted that despite generally unfavorable circumstances, industrial use of cryptocurrencies kept growing.
Novogratz’s remarks come as user confidence in centralized cryptocurrency platforms has been damaged by the recent collapse of FTX, which was previously the third-largest cryptocurrency exchange in the world. There was unprecedented fraud and deception at the exchange, according to early investigations into FTX and its discredited founder Sam Bankman-Fried.
According to reports, SBF was detained by The Bahamas’ authorities on Monday after US prosecutors formally filed criminal accusations against him. While the SEC has separately accused SBF of “orchestrating a scheme to deceive equity investors in FTX,” the Southern District of New York has indicted SBF on eight criminal counts, including conspiracy to commit wire fraud and theft of customer cash.
Binance Withdrawals Increase
Notably, withdrawals from Binance, the biggest cryptocurrency exchange in the world, have increased recently as stories regarding purported issues at the platform continue to spread like wildfire. In particular, the exchange experienced withdrawals worth over $3 billion on Tuesday.
BNB, the native cryptocurrency of Binance, has lost 15% of its value in the last week, with a loss of more than 6% over the last day. According to CoinMarketCap, BNB, which was initially created in 2017, is the fifth most valuable cryptocurrency in the world with a market valuation of roughly $39 billion. Only bitcoin, ethereum, tether, and USD Coin are ahead of it.
Demands for withdrawal are a source of worry according to Binance CEO Changpeng Zhao. Zhao said that there were over $1.14 billion in net withdrawals on Tuesday, but he also tweeted that this wasn’t the greatest number of withdrawals he had ever handled. He said the situation had “stabilized” on Wednesday. According to blockchain analytics company Nansen, there were $3 billion worth of withdrawals on Tuesday.
Image Courtesy of Shutterstock
