Today we will do an FTX Review to find out why you should avoid the FTX exchange in 2023. The quantitative crypto trading company and liquidity supplier Alameda Research supports the cryptocurrency exchange FTX. With a broad selection of trading choices and products, FTX Exchange was created by traders for traders. The popularity and quick expansion of FTX is rapidly elevating them to the status of one of the largest exchanges, where they will soon compete with the likes of Binance Exchange. Sam Bankman-Fried, the founder and previous CEO of the cryptocurrency exchange FTX, is closely related to the company. The abrupt and disastrous fall of FTX in late 2022 will have an impact on the global cryptocurrency community for years to come.
Let’s get right to this FTX review: Why You Should Avoid This Exchange In 2023.
About FTX Exchange
The third-largest cryptocurrency exchange in the world in July 2021, FTX Exchange was a well-known centralized exchange focusing on derivatives and leveraged goods. It provided various trading products, such as derivatives, options, volatility products, and leveraged tokens. FTX was established in 2018 by former Jane Street Capital foreign exchange-traded funds (ETFs) trader and Massachusetts Institute of Technology (MIT) graduate Sam Bankman-Fried.
One of the biggest crypto trading exchanges in the world, it handles about 11% of the $2.4 trillion in derivatives traded every month. Last year, the business obtained $1.5 billion in private capital, causing its valuation to jump from $1.2 billion to $25 billion. Its value reached $32 billion in January of this year after a $500 million raise. As it pursues American customers with a separate entity, FTX US, valued at $8 billion, FTX is spending millions of dollars on marketing and hiring celebrities as brand ambassadors, including Tom Brady, David Ortiz, and Kevin O’Leary.
Funding: The funding of $1.8 billion is from Temasek, Sequoia, Thoma Bravo, etc.
Latest valuation: The latest valuation is $32 billion.
Bona fides: In 2021, FTX reached about $1 billion in revenue; grew its customer base from 246,000 in 2020 to 3.1 million in 2021.
Cofounders: The world’s second-richest crypto billionaire, CEO Sam Bankman-Fried, 30, and CTO Gary Wang,
Why You Should Avoid This Exchange In 2023
Following a CoinDesk report highlighting possible leverage and solvency issues involving FTX-affiliated trading firm Alameda Research, FTX collapsed in early November 2022. The FTX’s collapse shook the unpredictable cryptocurrency market, which at the moment lost billions and lost its $1 trillion valuation.
In the FTX review from November 2022, FTX experienced a liquidity crisis and sought financial assistance; rival exchange Binance briefly considered purchasing portions of the business but soon backed out. On November 11, 2022, FTX’s CEO stepped down, and the business filed for bankruptcy. After that, the FTX company experienced a hack where tokens valued hundreds of millions were taken. The founder and former CEO of FTX, Sam Bankman-Fried, was arrested in The Bahamas and extradited to the US in late December. On January 3, 2023, he pleaded innocent to all criminal charges.
According to the report, Alameda’s investment foundation used FTT, a token created by its sister company, rather than fiat money or another type of cryptocurrency. That raised questions about Bankman-‘ Fried’s companies regarding undisclosed leverage and solvency throughout the cryptocurrency industry.
What features does FTX Exchange offer?
In the bid to do FTX Review, let’s take a look at the features that FTX offers.
- FTX Exchange Mobile Apps
For Android, Google, and Apple iOS smartphones, there is a downloadable app for the FTX exchange.
- FTT Token
The FTX exchange’s native token, FTT, can be used to lower transaction costs on the exchange. The free withdrawal of Ethereum and ERC20 tokens is one of the main advantages of having the FTT token.
- Staking FTT Token
The FTT token can also be staked on FTX Exchange; by staking the FTT token, you will receive some benefits like; Increased Referral Rates, Maker Fee Rebates, Airdrop Rewards, Bonus Votes, and Trading Derivatives.
The FTX exchange provides five different types of cryptocurrency derivatives products that can be traded using a single margin wallet.
- Tokenized Stocks
On the FTX exchange, traders can trade on tokenized stocks with digital assets from BioNTech, Beyond Meat, Pfizer, Apple, Tesla, Amazon, Netflix, Facebook, Google, Bilibili, and Alibaba.
You can buy stocks and exchange-traded funds (ETFs) on this exchange through FTX Stocks. The USD Coin (USDC) stablecoin can be used to fund your account; best of all, there are no fees. It also employs the same FTX.US interface. FTX.US makes it simple to maintain your stock and cryptocurrency portfolios in one place.
Is FTX safe?
A 2FA procedure is used to protect FTX. An extensive multi-tier KYC procedure is used to support this authentication as well. Before users can start purchasing, KYC must be completed.
Is FTX good for beginners?
With useful educational material and even quizzes where you can earn free cryptocurrency, it is much more beginner-friendly. It’s a good choice for investors who want access to various cryptocurrencies, and it also has tools for experienced traders.
Users could buy, trade, and enter into derivative contracts for coins and tokens on the well-known and frequently used cryptocurrency exchange known as FTX. The platform allowed traders worldwide to exchange hundreds of digital currencies for relatively low fees, though it was unavailable to residents of the United States due to cryptocurrency regulation. Additionally, FTX encouraged NFT and collectibles transactions. That is, until it went bankrupt, got hacked, had its CEO stepped down and arrested, and investigations into the exchange as a Ponzi scheme started.
After reading this FTX Review article, we hope you can see why you should avoid the FTX Exchange in 2023. What are your thoughts? Ask questions, and we’ll happily respond as soon as possible.