The collapse of the FTX crypto exchange caused millions in damages. The creation of value through Bitcoins and the existence of cryptocurrencies & contracts still seems incomprehensible to many people.
Bitcoin identity
๐ฐ The existence of “a crypto” or the synonym of the Bitcoin coin as a digital currency is a myth in society. Bitcoin value is intrinsically cryptic and not firmly definable.
๐ป Bitcoin is considered a cryptocurrency that can be used to order from online merchants, convert the digital money into real currencies and grant credit to other crypto followers.
Bitcoin as the currency of the internet
๐ข To qualify as a currency, a guarantee of the bitcoin’s ability to pay must be accepted by the state and central bank, and the amount must be limited. This was covered by limiting the maximum value to 21 million units.
๐ The files can be used as a medium of exchange and store of value. Tax payment with cryptocurrencies are not possible.
FTX
๐ Bitcoin owes its price gain to its zero interest rate policy and the assumption of investors that the invested bitcoin value would multiply on its own. The sudden use of interest led to a rapid drop in value and the young entrepreneurs’ handling of other people’s money led to an investment scandal when the crypto asset fell. Customers did not get their investments back.
๐ต๏ธ Although crypto files are unique and forgery-proof, however, fraud occurs again and again. Digital advances make it easier to move larger sums of money from one place to another.
๐งโ๐ป Bankman-Fried, the founder of FTX, is now on trial for financial fraud and money laundering, and his company has been in bankruptcy proceedings since November 2022.
