Multicoin Expects FTX Contagion To Hold Industry In Its Grips For Weeks To Come

2022-11-19 16:04

In a letter to its investors, one of the industry’s most notable crypto venture firms, Multcoin Capital, has revealed its thesis for the coming weeks.

Managing partners Kyle Samani and Tushar Jain write in a 3,400-word letter that the FTX fiasco does not spell doom for the crypto industry, as critics like Peter Schiff and Nassim Taleb recently did.

“Just as Lehman Brothers didn’t kill banking and Enron wasn’t the death of energy companies, FTX won’t be the end of the crypto industry,” the venture capital firm said.

At the same time, the firm warns its investors that FTX’s collapse will cause more fallouts. Samani and Tushar wrote:

We expect to see contagion fallout from FTX/Alameda over the next few weeks.

Many trading firms will be wiped out and shut down, which will put pressure on liquidity and volume throughout the crypto ecosystem. We have seen several announcements already on this front, but expect to see more.

According to Multicoin, leverage must first be removed from the system before there will be “green shoots next year.”

Multicoin Trusted FTX

Samani’s company also acknowledged its own mistakes, though. Thus, it had placed “too much trust” in FTX. As a result, Multicoin lost 15.6% of its total fund assets on FTX.

The venture firm was only able to recover about a quarter of its funds that were deposited on the exchange. Although waiting to see how the bankruptcy proceedings progress, the company expects to write down its investment in FTX to zero.

In doing so, Multicoin follows the fate of other investors in FTX, such as Temasek, Sequoia Capital and Softbank.

Due to the loss of confidence, Multicoin said it is only trading on two other exchanges, Coinbase and Binance. For now, however, the company only relies on Coinbase custody and self-managed cold wallets, it said.

The Future Of Solana (SOL)

By its own account, Multicoin has invested a large amount in Solana (SOL). The token was one of the biggest sufferers in the FTX collapse, as SOL was one of FTX’s largest positions along with FTT.

On November 05, SOL was still trading at a price of $38.71 on Binance before the steep crash to currently $13.53 took place.

SOL saw an unprecedented drop following the first FTX rumors. Source: TradingView

Despite the heavy losses, Multicoin officially still believes in Solana’s long-term potential, according to its letter to investors. The venture firm said it’s holding its position and still expects a bright future for Solana, because the cryptocurrency has “one of the most vibrant developer communities.”

Based on our experience in 2018 and 2020, we learned that it’s not prudent to sell an asset during a short-lived crisis if the core thesis is not impaired,” the letter states.

However, there is a juicy (unconfirmed) rumor circulating that Samani and Jain handled his personal funds differently. Allegedly, the general partners sold their personal SOL stashes near the top.

Unconfirmed: LP states that Multicoin GPs sold their personal SOL stashes near the top while refusing to sell for the fund and bull tweeting. They made lavish real estate and automobile purchases and have failed to return necessary $ to LPs for tax obligations.

Haters take note pic.twitter.com/uPONWcods3

— Evanss6.eth (@Evan_ss6) November 17, 2022

Similar to Notcoin - Blum - Airdrops In 2024

origin »

Vice Industry Token (VIT) на Currencies.ru

$ 9.59E-5 (+0.36%)
Объем 24H $8
Изменеия 24h: 0.01 %, 7d: -71.49 %
Cегодня L: $9.59E-5 - H: $9.59E-5
Капитализация $276.56k Rank 99999
Доступно / Всего 2.884b VIT

industry weeks letter ftx crypto fiasco does

industry weeks → Результатов: 126


Фото:

Bitcoin On-chain Metrics Confirm Lacklustre Capital Influx and Bottom Cycle Consolidation Phase

The cryptocurrency industry has not been attracting many new investors since April this year, so cryptocurrency projects now do not have the much-needed momentum to push up crypto prices. Traders and investors should expect the current bear market cycle to last for some more days or weeks because on-chain data shows that additional accumulation is […]

2022-8-26 00:59


ETHWarsaw, the Biggest Web3 Conference and Hackathon in CEE Starts Next Month

An inaugural conference is coming at a turning point for the industry as a whole and the ambition is to meet in Warsaw every year to celebrate the Ethereum milestone – The Merge. [WARSAW – August 22, 2022] – As we enter the final weeks leading up to the Merge, thousands of experienced builders and … Continued The post ETHWarsaw, the Biggest Web3 Conference and Hackathon in CEE Starts Next Month appeared first on BeInCrypto.

2022-8-22 19:36


OpenSea sets fresh daily trading record

For the last few weeks, reports of the NFT market being dead have permeated our airwaves, but now OpenSea recently set a new daily trading record leaving skeptics in awe NFTs aren’t dead If you’ve been in the NFT space for a while, you’ll most likely have heard reports from “experts” and industry players about […] The post OpenSea sets fresh daily trading record appeared first on NFT News Today.

2022-5-4 14:54


Why DIGITALAX declines the invite to Decentraland Metaverse Fashion Week with a Public Announcement

From the 24th-27th of March 2022 Decentraland will be hosting a Metaverse Fashion Week, to which DIGITALAX was eagerly invited to take part in during Miami Art Basel (December 2021). As IRL, regional, digital, crypto, web3 and metaverse fashion weeks proliferate, the better it is for this fast growing industry.

2022-1-31 03:23


Фото:

Gate.io’s Perpetual Contracts More Popular Than Ever

During Bitcoin’s most recent run which saw it break through its previous all-time high, trading volume on leading cryptocurrency exchange, Gate.io, surged during September and October. The Securities and Exchange Commission (SEC) greenlit bitcoin futures ETFs on October 15th, in an industry first that has sent the leading cryptocurrency surging in recent weeks. Last week, […]

2021-10-27 13:28


NFTrade Launches Mainnet to Optimize and Expand the NFT Ecosystem

In the current cryptocurrency bull market, many projects have no trouble raising millions of dollars off the back of a whitepaper and decent-looking website. NFTrade is taking a different and more direct approach, one the industry should follow, launching their mainnet weeks before their token generation event, allowing anyone to use the platform first hand […]

2021-5-19 13:25


Фото:

Here’s why Bitcoin (BTC) price is struggling this week as Ethereum (ETH) hits new highs

Bitcoin (BTC) price is trading about 3% lower this week as it faces mild selling pressure, following a strong push higher in recent weeks.  BTC price could decline 50% in the short run, says Guggenheim CIO Bitcoin price has corrected lower in the past two weeks as industry experts and analysts warn of an oversaturation […] The post Here’s why Bitcoin (BTC) price is struggling this week as Ethereum (ETH) hits new highs appeared first on Invezz.

2021-4-22 17:30


Фото:

Scores of Developers Predicted to Ditch Ethereum for Cardano as Blockbuster Update Nears

Cardano (ADA) has been doing great of late. The crypto has scored impressive gains over the last 10 weeks, with an even more impressive 3,800% over the last 12 months. Notably, Cardano’s good fortunes are rooted in the team’s ambitious focus on developing the most prolific and user-friendly blockchain network in the industry. This effort […]

2021-4-22 15:40


Our Statement On Recent Market Participant Activity

The public and press have only heard the story from the SEC’s side, and we’ll be filing our response in a few weeks to address these unproven allegations against Ripple.   The SEC’s decision to file this action is not just about Ripple, it is an attack on the entire crypto industry here in the United … Continued The post Our Statement On Recent Market Participant Activity appeared first on Ripple.

2020-12-30 20:04