Since crypto giant FTX declared bankruptcy on November 11, 2022, the crypto industry has been fraught with uncertainty. Even as the entire crypto industry comes to terms with FTX’s fall from grace, some industry heavyweights continue to believe in Bankman Fried.
Despite losing money in FTX’s shocking collapse, Canadian businessman and Shark Tank star Kevin O’Leary believes Sam Bankman Fried’s future businesses are worth investing in.
In a recent exclusive interview, O’Leary explained the extent of his exposure and involvement in the exchange, stating that the company’s demise has a “silver lining.”
In the Tuesday interview, Mr. Wonderful admitted that FTX was one of his “bad investments” but is still safe due to asset diversification. Nonetheless, the investor took a “significant hit.” He claimed to be a shareholder of FTX and FTX US and had multiple accounts with the exchange, all of which have since been frozen.
“I’ve spoken to a number of other institutional investors who use the platform, and they, too, have zero balances,” he added. “Everyone is discussing this with their accountants, lawyers, auditors, and compliance departments. It’s an extraordinary circumstance.”
O’Leary previously worked as an FTX spokesperson. He said last month that the exchange was the last place he’d expect to “get in trouble.” He also predicted in June that crypto would hit rock bottom once a “big player” was eliminated, which he now believes to be FTX.
Another silver lining, according to O’Leary, is that the exchange’s debacle is putting pressure on regulators to provide more explicit industry guidelines in the future. Critical elements of crypto legislation, such as the Digital Commodity Act, are receiving renewed attention after languishing in Congress.
Meanwhile, the investor intends to transfer all his assets from unregulated exchanges to Bitbuy, a regulated Canadian exchange. The company is governed by the Ontario Securities Commission (OSC) and is prohibited by law from mixing user funds in the manner that FTX is suspected of doing.
According to O’Leary, cold storage custody of assets is not an option for firms mandated to limit their crypto exposure to a certain percentage of their net worth. As a result, assets must be available for trading at all times so that they can sell specific assets while remaining within their “diversified mandate.”
In contrast to the United States, Canada was the first country to approve a Bitcoin Spot ETF, which tracks the spot price of Bitcoin. It has since approved Bitcoin, and Ethereum mixed ETFs.
When asked if he would back Bankman-Fried in a hypothetical new crypto venture, O’Leary said yes, as long as the former billionaire only had “trading control” of assets rather than “operational control.” Overall, he described the crypto tycoon as an “unusual one percent person” when it comes to an understanding of how digital assets work.
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