THE FTX COLLAPSE SCANDAL

Things went downhill for FTX, after Binance, the world's largest cryptocurrency exchange, reversed on a deal to save the company. This collapse is being termed as the crypto's "Lehman moment".

FTX is one of the world's largest cryptocurrency exchanges. FTX is a digital currency exchange, a platform where people could buy and sell digital assets like bitcoin, dogecoin and ether. Simply put, it enables customers to trade digital currencies for other digital currencies or traditional money, and vice versa. It is based in the Bahamas and was run by Mr. Bankman-Fried. It has spent millions of dollars lobbying U.S. legislators to institute crypto-friendly regulation. The company had built its business on risky trading options that are not legal in the United States. The crypto industry overall has increasingly been the target of regulatory scrutiny on Capitol Hill and across the globe.

The company, founded in 2019, quickly rose to international prominence through a series of high-profile acquisitions, aggressive marketing strategies and low trading fees. It's competitor platforms include Kraken, Coinbase and Gemini. FTX became quite popular, and it managed to lure, even those unfamiliar with technology, onto its platform by showing promises that they could get much higher yields than traditional banks. Major venture capital groups also bought in, investing almost $2 billion in the company. Sam Bankman-Fried, FTX's 30-year-old founder, became the face of the company. Celebrity endorsements and major sports sponsorships made FTX hard to miss. Not long after Bankman-Fried started FTX, crypto began to boom. The price of bitcoin, which had traded at around $10,000, shot up in 2021, peaking at more than $64,000. Venture capital money flooded into all things blockchain, and crypto, and crypto platforms moved to attract customers beyond the technologists and blockchain evangelists that once fuelled its rise. The price of bitcoin, which is generally agreed upon to be the indicator of broader crypto market, declined dramatically from its late 2021 heights. It is now trading at around $17000.