Celebrity investor Kevin O’Leary is still advocating for FTX and its former CEO, Sam Bankman-Fried. In a written testimony to the US Congress, O’Leary also advocated for the entire cryptocurrency sector, saying there was still promise and potential in the industry.
Kevin O’Leary’s thoughts on FTX collapse
In the testimony written by O’Leary to the Senate Committee on Banking, Housing, and Urban Affairs, O’Leary said that there was a need to investigate what happened with FTX and get to be bottom of what had caused the exchange’s collapse. However, he said the fallout should not cause the abandonment of the entire crypto industry.
O’Leary has also shared his hypothesis on what he believes caused FTX’s fallout and the exchange’s bankruptcy. His argument and that of Bankman-Fried are somewhat similar, as the latter continues to believe that he has no criminal liability.
Bankman-Fried was recently arrested in the Bahamas after the US government filed criminal charges against him. The FTX founder is facing multiple criminal charges, including wire fraud, securities fraud, and elections fraud.
However, in his testimony, O’Leary did not mention anything about the charges facing Bankman-Fried, and his misuse of customer funds. Instead, he believes that the FTX fallout was caused by Binance and its CEO, Changpeng Zhao.
O’Leary said that FTX and one of its largest competitors, Binance, “were at war with each other, and one put the other out of business intentionally.” The Shark Tank investor added that with FTX going under, Binance was now an unregulated global monopoly.
Before the FTX exchange filed for bankruptcy, Binance’s CEO had taken to Twitter to say that it would sell all its FTT holdings because of some revelations that had come to light. Zhao later hacked out of a possible deal to acquire FTX, saying that the issues facing the exchange were beyond Binance’s control.
A few days before Zhao’s tweet, a report by CoinDesk had poked holes into the balance sheet of Alameda, a crypto hedge fund that Bankman-Fried also founded. The company’s balance sheet showed that it held many illiquid tokens issued by FTX.
While these events could have accelerated the collapse of the FTX, there is no evidence that Binance played a hand, given the mounting evidence that FTX misappropriated customer funds.
O’Leary’s investment in crypto
O’Leary was among the celebrities who endorsed the FTX exchange and were named equity stakeholders. FTX partnered with celebrities such as Tom Brady and Stephen Curry.
Besides endorsing FTX, O’Leary is also a crypto investor. In December last year, he had said that crypto accounted for around 10.5% of his crypto portfolio, adding that no single token accounted for over 5% of his crypto holdings.
Last week, Zhao criticized O’Leary over his relationship with FTX. The Binance CEO said that if O’Leary was looking for someone to blame, he should look at small and perhaps himself.
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