One of the biggest stories for the financial markets in late 2022 is the collapse of the cryptocurrency platform FTX and the continuation of the crypto winter.
What Happened: Leading cryptocurrency platform FTX faced liquidity issues in late 2022 that eventually led to the company declaring bankruptcy and the company’s co-founder Sam Bankman-Fried being arrested in the Bahamas.
The liquidity issues and bankruptcy from FTX have put further pressure on major cryptocurrencies Bitcoin and Ethereum (CRYPTO: ETH), with each down more than 50% year-to-date in 2022. The FTX Token (CRYPTO: FTT) also collapsed in value due to the bankruptcy.
Prior to the issues at FTX, the company was one of the three largest cryptocurrency platforms by trading volumes and one of the most widely recognized names in the space.
FTX was valued at $32 billion and Bankman-Fried, who co-founded the company with Gary Wang, was worth $16 billion. The company was spending aggressively on sports sponsorships and endorsement deals, all being done as the company may have committed fraud and misused user funds.
The company officially launched operations on May 8, 2019, and the whitepaper for the FTX Token in May 2019 with a launch several months later.
While the price of cryptocurrencies was down in 2022, anyone who followed the FTX story from the start may have had better luck.
Related Link: Best FTX Alternatives: How To Keep Your Crypto Safe
Investing $1,000 in Bitcoin: When FTX officially launched operations, Bitcoin traded between $5,794.72 and $5,989.98.
A $1,000 investment in Bitcoin at its highest price point on the day FTX launched could have bought 0.1669 BTC.
The $1,000 investment in Bitcoin would be worth $2,964.37 today based on a price of $17,761.38 at the time of writing. This represents a gain of 196.4% from the original investment. The investment would have gained an average of 54.8% annually over the last three years and seven months.
At the peak price of Bitcoin in November 2021, the $1,000 investment would have been worth $11,480.99.
Check out Benzinga's coverage on all things FTX and Sam Bankman-Fried here.
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