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Reflecting on FTX and One of the Wildest Weeks in Web3

Ed Note: Every Friday I send a weekly update to the Hiro team - today I wrote about FTX, what it means, and why we’ll get through this. Sharing the letter below for all of you.

Type
Recap
Topic(s)
Hiro
Published
November 11, 2022
Author(s)
CEO
Contents
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The collapse (and now official bankruptcy) of FTX and the revelation of the unethical (and let’s be frank, sociopathic) behavior by Sam Bankman-Fried is going to be with us for a bit. While Hiro had no exposure to FTX, Sam’s extremely public persona as a “good guy of crypto”, his outsized presence in Washington DC, and the perceived stability of FTX means everyone in crypto is going to be painted with the same brush.

But while some things will suck in the short term (the recriminations, declines in trust across the industry, probably additional hits to token prices across the board), it’s important that this happened. It will ultimately be better for all of us.

First, as with all things, you cannot heal until you cut out the disease—and clearly Sam and FTX were a disease. We thought that they were good guys, but actually they were just shady as f*ck and unbelievably greedy. FTX’s collapse was going to happen sooner or later, so better it happens now than in the future when even more is at stake.

Second, this was only possible because FTX was a centralized exchange, basically acting like a bank, with total opacity and the ability to do whatever they wanted. And that’s the exact opposite of what we’re building here! We’re building decentralization and transparency, so that people can’t implode financial systems like this. Whether they’re traditional or “crypto”.

Not all projects are built equal, and there’s a reason we believe in Stacks and the approach our community has taken. There’s a reason we’ve done things right and transparently and decentralized from the beginning. Because it may be slower to get going, we may not have Gisele doing commercials for us, but it’s stronger, it’s better, and it lasts.

Just like the bear markets of yore, we will come through this, we will be stronger, and we will build great new things that enable the next generation of technology.

Onwards!

Alex

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