...and is definitely not an enormous grift that's pouring lighter fluid on our already smoldering planet.
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Ten of the NFTs in the collection came with lifetime passes to Coachella, and sold for six figures. Each year, the NFT holder has to go through the redemption process to obtain their festival pass.
Many of the token owners bought their NFTs with FTX and simply left them in their accounts on the platform. Some were able to transfer their tokens before FTX's NFT platform stopped operating, but many did not.
Now, the Wall Street Journal reports that BlockFi has been considering layoffs, and has been in talks with bankruptcy attorneys about a possible Chapter 11 filing.
Although BlockFi disputed reports that they had been custodying client assets at FTX, they acknowledged that they had "significant exposure to FTX and associated corporate entities that encompasses obligations owed to us by Alameda, assets held at FTX.com, and undrawn amounts from our credit line with FTX.US".
This not entirely unlike someone trying to sell you a house that is "otherwise sturdy, but in an engulfed-in-flames crisis".
He says the project is intended to reduce the "cascading negative effects of FTX", underscoring how nervous this whole debacle is making other players in the industry.
He announced that they would continue trading their remaining assets, and continue operating their venture fund. However, he said the future of the hedge fund was unclear, and likely to depend on what happens with FTX customer withdrawals.
"I'm pretty disgusted with the space as a whole and kinda humanity in general," he continued. "I'm at a loss for words at the depth & breadth of the pieces of shit that permeate crypto. So many fucking sociopaths were granted the opportunity to do so much damage. It's hard for me to imagine the space bouncing back quickly from this ordeal. Too many got burned too hard."
Users have been hesitant to believe this explanation, given the enormous shakeup in the industry lately, and the tendency for firms to be less-than-forthcoming when they are in major crisis.
Three days prior, the company had published a blog post claiming that AAX had no exposure to FTX and its affiliated companies, that AAX had stable reserves, and that user funds were never exposed to counterparty risk.
This serves as a good example of how theft amounts shouldn't be naively calculated based on the token price before the theft × the number of tokens stolen. $FLARE was priced at around $18.25 before the attack, and a naive calculation would place the theft amount at $71 billion. However, the lack of liquidity caused the token price to plummet to $0.0000018, and the attacker ultimately ended up with around $17 million.
The total funds stolen appear to be around $4.17 million, according to analysis by SlowMist.
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