Kraken CEO On FTX Collapse: ‘The Damage Here Is Huge’

After Sam Bankman-bitcoin Fried’s exchange FTX collapsed, the industry’s standards needed to be raised.

Jesse Powell, the CEO and co-founder of a similar exchange called Kraken, called out industry “clowns” that take advantage of their clients.

“Our good, trusting nature makes us easy targets for con artists. Some even tell us straight up that they’re here for profits, not crypto, and we praise them for their honesty. Yet we’re surprised when they turn out to be who they said they are. We need to raise our standards,” he said in a tweet thread.

One business that has exposure to FTX is Kraken

About 9,000 FTT, the FTX native token, are kept there. A number of other investors have also made public declarations outlining their exposure to the company, including Amber Group, Crypto.com, Galaxy Digital, Multicoin Capital, Selling Capital, Sequoia Capital, and Wintermute.

The company and Powell, who is leaving his position as Kraken’s CEO early next year, have both highlighted that their organization is not “materially harmed” by the latest FTX news. Kraken CEO, however, claimed that “the damage here is significant” for the sector as a whole.

Following news that Sam Bankman-trading Fried’s company owned considerable amounts of FTT, concerns were raised regarding the relationship between the two businesses, which led to FTX running into issues at the beginning of this month.

A couple of days later, the cryptocurrency exchange Binance announced it will sell its FTT holdings. A non-binding letter of intent to purchase the competing exchange was then signed by Binance. It withdrew from the deal yesterday after reviewing FTX’s financial statements.

“An exchange implosion of this magnitude is a gift to bitcoin haters all over the world. It’s the excuse they were waiting for to justify whatever attack they’ve been keeping in their back pocket,” Powell said.

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