What Is FTX?
FTX is a centralized cryptocurrency exchange that offered a wide range of trading and financial services. It was founded in 2019 by Sam Bankman-Fried and Gary Wang.
Background
FTX is known for its innovative products, including leveraged tokens, prediction markets, tokenized stocks, and volatility tokens. Users can also participate in various activities, from minting and trading NFTs to participating in Initial Exchange Offerings (IEOs).
How It Works
The FTX platform operates using its utility token, FTT. Holding FTT tokens provides various benefits, such as trading fee discounts, higher referral rates, free withdrawals, and IEO participation. The benefits increase with the number of FTT tokens held or staked. FTX also uses part of its profits to buy back and burn FTT tokens.
However, in 2022, rumors about the insolvency of FTX led to its collapse. Investigations into the collapse led to the discovery of fraud, resulting in criminal charges against Sam Bankman-Fried and other associated individuals. FTX itself is now in bankruptcy.
Key Takeaways
- FTX is a centralized cryptocurrency exchange offering a range of trading and financial services, founded in 2019 by Sam Bankman-Fried and Gary Wang.
- The platform is known for its innovative products like leveraged tokens, prediction markets, tokenized stocks, and volatility tokens.
- The FTX platform operates using its utility token, FTT, which provides various benefits to its holders.
- FTX uses part of its profits to buy back and burn FTT tokens, making it a deflationary token.
- In 2022, FTX collapsed due to rumors of insolvency. Investigations revealed fraud and led to criminal charges against the founders.
