Founder and CEO of FTX, Sam Bankman-Fried, has lost 93% of his wealth within a day, as his net worth drops by $14.6B to $991M in 24 hours.
FTX Chief Sam “SBF” Bankman-Fried has now lost his billionaire status following a 93% decline of his net worth to $991M in under 24 hours. The American entrepreneur, whose net assets were valued at $15.5B barely 48 hours ago, lost over $14.6B in the past day in the wake of the recent decline of FTX’s native token, FTT.
Considering SBF’s close ties with FTX and Alameda Research, most of his net worth is tied to the value of the exchange’s native token, FTT. Consequently, the massive slump in the value of FTT prompted by the recent wave of selloffs has substantially impacted SBF’s billionaire status, as indicated by Bloomberg.
SBF appears to be the most affected by the recent worrisome concerns plaguing Alameda Research, FTX, and FTT. Following the disclosure from Binance’s CZ of the exchange’s intention to liquidate its FTT holdings, the community witnessed a wave of panic dumped into the space.
This triggered a cascade of selloffs involving FTT and a mass withdrawal of assets from FTX by investors concerned about the possibility of insolvency. The community now takes the slightest hint of insolvency more seriously, considering the recent fiascos that have led to losses in investor funds within the crypto space, including but not limited to Terra, 3AC, and Celsius.
Despite indicating that Binance’s manner of approach will ensure that its liquidation of FTT does not negatively impact the market, the asset suffered a huge blow from the announcement, losing over 70% of its value in under 24 hours.
Amidst the panic sales and the bank run FTX was witnessing, SBF signed a Letter of Intent (LOI) with Binance’s CZ for the acquisition of FTX to help it address its liquidity crunch predicament, as The Crypto Basic previously highlighted.
Notwithstanding, CZ mentioned that the deal is non-binding, and considering the dynamics of the FTX situation, the possibility of a pull-out exists. The Binance Chief noted that they would be conducting Due Diligence (DD) into FTX in the coming days.
Despite the lifeline from Binance, FTT’s decline persisted, with the asset changing hands at $4.79 as of press time. The Crypto Basic previously pointed out the risk of the asset dipping below the support at $10.70 when it was trading at the $14.7 region.
The current value of $4.79 is the lowest the asset has touched since December 2020. The price impact has also significantly affected FTT’s market capitalization, dropping from the 30th position on the list of largest assets by valuation to the 60th in under 24 hours. The asset now has a market cap of $653M, down from the $2.53B witnessed in the past day.
Follow Us on Twitter and Facebook.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.