US-based blockchain analytics firm, Chainalysis, released a report on Wednesday claiming that while the bankruptcy of Sam Bankman-Fried’s cryptocurrency exchange FTX has affected the crypto market, it does not represent the worst losses for crypto investors in 2022.
According to the outcomes of the study, the implosion of the Terra Luna stablecoin UST in May as well as the failure of the Celsius lending platform and the Three Arrows Capital (3AC) hedge fund a few weeks later were the primary contributors to the largest observed losses in individual cryptocurrency investments this year.
Once worth as much as $40 billion, the algorithmic stablecoin TerraUSD (also known as UST) experienced a catastrophic meltdown in May, shedding nearly all of its value. In the summer, Celsius and 3AC went bankrupt as the collapse caused them to stop making payments. Chainalysis predicts that the crash of Terra Luna resulted in realized losses of $20.5 billion, while the crash of Celsius and 3AC cleaned out $33 billion. This estimate is based on statistics of weekly realized profits and losses of all personal cryptocurrency wallets.
FTX Cleaned off $9 Billion
The crypto monitoring firm Nansen released a report on FTX claiming that large losses at FTX likely contributed to the downfall of Sam Bankman-Fried’s crypto empire following Terra Luna’s demise.
According to Chainalysis, FTX’s bankruptcy led to realized losses of around $9 billion. However, it is stated in the report that the mentioned result does not include the assets of individuals whose positions have been placed on hold on the FTX market.
According to the bankruptcy documents, the failure of FTX has left around 1 million investors uncertain of the future of their investments.
Notably, the United States requested the detention of Sam Bankman-Fried, the infamous ex-CEO of FTX, in the Bahamas, a day before he was set to testify before Congress following the Bahamian government’s refusal to release him on parole.
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