FTX and the Lessons of Liquidity
The liquidity crisis that hobbled Sam Bankman-Fried’s empire was at its heart a crisis of confidence. A breakdown of trust that wasn’t unique to him or the crypto world alone. Long-Term Capital Management in 1998, Lehman Brothers in 2008. Remember them? They each in one way or another fell victim to vanishing liquidity spurred by a breakdown of trust from their counterparties and clients. Without trust, nothing functions. A hard lesson learned recently by FTX and Sam Bankman-Fried.
Nov 15, 2022