New York
CNN Business
—
Larry David made a very good prediction for this week’s cryptocurrency crash.
In a Super Bowl ad for the FTX cryptocurrency exchange in February, Larry David sarcastically predicted that FTX would not be successful. The ad showcases David’s character throughout history, denying humanity’s greatest inventions, including the wheel, the light bulb, coffee and democracy.
At the end of the ad, David learns about FTX, “a secure and simple way to encrypt.” A dismissive David said: “Well, I don’t think so. I’m never wrong about this stuff – never.”
“Don’t be like Larry,” the FTX ad ends.
advertise resurfaced superior social media After FTX imploded this week. As it turns out, David’s character is questionable.
FTX filed for bankruptcy in the U.S. on Friday, marking the stunning downfall of one of the biggest and most powerful players in the crypto industry. The exchange’s 30-year-old founder and CEO Sam Bankman-Fried resigned.
Rival Binance had said it would explore an FTX bailout earlier this week, but withdrew almost immediately after the company said FTX was largely unsalvageable.
The full extent of FTX’s financial problems is unclear, but multiple reports say the company faces an $8 billion shortfall. Bankman-Fried reportedly told investors Thursday that without a quick equity injection, the company faces bankruptcy.
Despite its reputation as a reliable, low-risk investment portal, FTX’s business appears to be built on a complex, extremely risky leveraged trade.
Clients deposit funds for crypto transactions. But FTX appears to have taken billions of dollars worth of funds and lent it to its sister company, Alameda, to fund these high-stakes bets, The Wall Street Journal reported.
CEO Sam Bankman-Fried resigned on Friday. He has been one of the face of the cryptocurrency industry, once amassing a fortune of $25 billion before disappearing. He is seen as a white knight in the crypto world, stepping in to rescue struggling companies earlier this year. Backed by elite investors like BlackRock and Sequoia Capital, FTX quickly became one of the largest cryptocurrency exchanges in the world.
Regulators are now opening an investigation into what went wrong, with some lawmakers calling for a crackdown.
– Matt Egan of CNN Business contributed to this report.