We all know that SBF’s Alameda Analysis and FTX had been concerned in a scheme utilizing FTT tokens to print cash out of skinny air. FTT was in fact the FTX change’s token that’s used to offer advantages to prospects whereas bringing in additional income. Customers may, for instance, stake FTT tokens in change for decrease charges and periodic airdrops relying on the quantity staked.
It is a quite common tactic as **nearly all** exchanges have a token that they use in an analogous mechanism the place they maintain full management of the token that gives advantages to change customers in change for them staking some quantity of the tokens.
Now right here is my query. What’s stopping any of the exchanges from working this identical scheme totally free cash. Why cannot some other change merely print tokens freely, lending(giving) it to what’s principally a shell firm, the shell firm borrows in opposition to these tokens and will get free cash. Rinse and repeat. In my estimate, **nothing.** Nothing is basically stopping these different exchanges from doing that. There are some limiting limitations, like interval launched of those tokens by on-chain deployer contract to restrict token creation, however FTX had this and it did completely nothing. As a matter of truth, it’s extra possible than not that different exchanges *have and are* working this identical scheme, however it simply so occurred that FTX was caught first.
They may do that and we might by no means know. It was solely from an Alameda steadiness sheet leak by Coindesk that we came upon. SBF was too boastful and confirmed everybody his playing cards. However different exchanges and founders are a lot sneakier and prepared to take pleasure in their spoils within the darkness. We would by no means discover out that the are the actual homeowners of some obtuse shell firm secretly funneling ~~hundreds of thousands~~billions.
EDIT: Sarcastically, quite a few different exchanges(like Huobi and some different apparent names) are *probably* concerned in one other of FTX’s schemes: Buying and selling with consumer belongings.