Summary:
- FTX CEO Sam Bankman-Fried said there’s a responsibility to step in and safeguard the crypto ecosystem amid significantly uncertain market conditions.
- SBF’s Alameda Research recently supported Voyager Digital with a $485 loan to help protect customer assets in case of massive volatility and liquidity pressure.
- The move comes after companies like Celsius and Three Arrows Capital suspended withdrawals citing an inability to match redemptions among other issues.
- SBF stressed that the contagion must be addressed to stop further slumps in crypto.
- The FTX boss also hinted that major fixes for Solana could be in place already.
- SOL’s price has skyrocketed over the past few days despite market pressure.
Crypto billionaire and CEO Sam Bankman-Fried opined that there’s a need to step in and play a more active role in aiding members of the digital asset ecosystem as the industry navigates uncertainty, company crashes, and market slumps.
The FTX chief shared his thoughts in a recent interview with NPR’s David Gura on the back on recent incidents involving stakeholders like Three Arrows Capital and Celsius.
Following the collapse of Terra’s tokens, LUNA Classic and TerraUSD (UST), Bitcoin and the broader crypto market took massive hits. The historical event also evolved into a lightning rod for regulators calling for tighter legislation around stables and other crypto tokens.
The Terra collapse ushered digital assets into a state of panic and uncertainty, unraveling further to cast shadows on industry stakeholders. A digital asset yield platform Celsius and a crypto hedge fund known as Three Arrows Capital are currently facing troubling times.
Celsius has paused withdrawals on its platform and 3AC is on the verge of insolvency amid harsh market conditions.
During his interview, SBF opined that the ongoing slump is largely due to actions taken by the feds. The FTX CEO said that “The core driver of this has been the Fed” and that “Literally, markets are scared,”.
Bankman-Fried also admitted the central bank has a difficult task to handle, describing the process as being “caught between a rock and a hard place.”
SBF Wants To Hedge Against Contagion In Crypto
The crypto billionaire surmised that averting further crises and aiding companies should take center stage. Over the weekend, Alameda Research approved a massive $485 million loan to Voyager Digital, a crypto brokerage service.
Voyager’s fresh credit line includes a $200 million package coupled with around 15,000 Bitcoins. The funds are earmarked to help protect customer assets in the case of unexpected volatility or liquidity pressure.
In the past, SBF and his firms have come to the aid of crypto companies in need. The Japanese crypto platform Liquid received a $120 cash injection from FTX after suffering a hack in 2021. At the time, hackers drained the exchange of around $100 million in digital assets.
FTX also disclosed plans to acquire the exchange shortly after.
Now, the crypto exchange chief believes that similar actions should be considered for the benefit of affected companies and the crypto ecosystem as a whole.
I do feel like we have a responsibility to seriously consider stepping in, even if it is at a loss to ourselves, to stem contagion… Even if we weren’t the ones who caused it, or weren’t involved in it. I think that’s what’s healthy for the ecosystem, and I want to do what can help it grow and thrive.
Major Solana Fixes Suggested By SBF As Token Price Climbs
Sam Bankman-Fried hinted that Solana could hush the haters during the bear market. SBF also suggested that the network could solve validator issues and that work towards this effect might already be underway.
Solana has faced criticism in recent months due to slow transactions and network outages. However, one user on Twitter Brian Long, pointed out the network is building and implementing fixes while others are occupied by market dips.
Indeed, Solana (SOL) has performed strongly over the past seven days and gained over 33% while competitors like Ethereum (ETH) have shed almost 8%. SOL is also up 12% in the last 24 hours alone and exchanges hands at $36.
SOL could continue this strong run with the major fixes suggested by SBF and further network boosts.
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