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Ripple CTO Comments On The Case Of FTX Becoming A Ponzi

Chief Technology Officer of Ripple Labs and co-creator of XRP Ledger and XRP, David Schwartz, has said to defend FTX founder Sam Bankman-Fried’s reputation of being called a Ponzi creator.

In contrast to Bernie Madoff, who purposefully started with a Ponzi scheme in the hopes of later replacing it with a legitimate business but instead created the largest Ponzi in history worth close to $65 billion, Sam Bankman-Fried appears to have started FTX as a legitimate cryptocurrency business before it gradually turned into a pyramid scheme.

He thinks that the exchange turned into a Ponzi scheme after Alameda Research began to incur losses. Another possibility is that Sam wished for the business to become more profitable. Another significant distinction between the two Ponzies is that while Sam Bankman-Fried lent customers money against their will, Madoff intentionally caused consumers to lose money.

Following the news of FTX’s bankruptcy, Sam Bankman-Fried’s fortune has now become zero.

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Harold

CoinCu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.