FTX is now beyond saving: Arthur Hayes

Arthur Hayes, former CEO of BitMEX, believes that the troubled crypto exchange FTX will fail now that Binance won't save it.

Arthur Hayes, former CEO of BitMEX, believes FTX will fail now that Binance won’t save it. The exchange co-founder predicted how this issue will affect the market. On Wednesday, Hayes claimed in a Twitter thread that there is no player powerful enough to buy FTX if Binance’s CEO, the richest man in crypto, is hesitant to do so.

🔥Reach more than 5 000 000 real investors via Twitter influencer marketing! 🔥

It is important to note that Binance signed a non-binding letter of intent to buy FTX and support it amid its “liquidity crunch” earlier on SBF request, following the withdrawal of the contract after considering an alleged government probe into FTX and a review of its management of customer deposits.

Parallelly, the Wall Street Journal reported that the exchange’s CEO Sam Bankman-Fried owed depositors $8 billion. Given the situation, Hayes doesn’t think clients will get their money returned soon. He states: 

“FTX customer deposits will only see recovery in a bankruptcy court, and that will take many years to sort out.”

He further takes an example: “Mt Gox creditors still haven’t received funds and it’s been almost a decade”. After losing hundreds of thousands of Bitcoin that had been deposited with them, the Bitcoin exchange Mt. Gox declared bankruptcy in 2013. The tangle of Bitcoin and Bitcoin Cash payments to creditors has yet to be resolved.”

Nonetheless, Hayes anticipates a new era in which exchanges more vigilantly protect their customers’ funds. Indeed, other markets, notably Binance, have already stated their intent to introduce proof-of-reserves infrastructure.

FTX insolvency leads to market crash attracting regulatory eyes

Hayes expects markets to “puke” lower as FTX’s insolvency unfolds. After Bitcoin fell below $16,000 on Wednesday due to FTX’s collapse, he warned investors to withdraw capital from firms with company exposure. However, crypto markets gained on Thursday after October’s CPI print showed declining inflation.

Many crypto experts suggested that the industry needs a better set of regulations to safeguard investors. As TheCoinRise reported, Indonesia recently noted the FTX crisis and stated that it will work toward toughening the country’s laws.

🔥Reach more than 5 000 000 real investors via Twitter influencer marketing! 🔥