The Number of Americans with a negative view of cryptocurrencies almost doubled; jumps from 25% to 43% following the collapse of FTX
There’s a big jump in the number of Americans with a negative view of cryptocurrency after a series of bankruptcies, crypto collapses, and scandals rocked the crypto industries. Americans’ views on cryptocurrencies have suddenly soured following the collapse of the now-bankrupt FTX, a crypto exchange founded by disgraced Sam Bankman-Fried.
According to the latest CNBC All-America Economic Survey, only 8 percent of the American public has a positive view of cryptocurrencies, down from 19% in March. The same survey found that the number of Americans with a negative view of cryptocurrencies jumped to 43%, up from 25% in March.
The survey, which was conducted between November 26 through 30, included 800 Americans and has a margin of error of +/- 3.5%.
“According to the survey, 42% of crypto investors now have a somewhat or very negative view of the asset, in line with the 43% result for all adults in the survey. The main difference: 17% of crypto investors are “very negative” compared with 47% for non-crypto investors.”
The sudden collapse of FTX has affected the overall credibility of crypto companies as investors moved their holdings away from exchanges into safer cold wallets. CNBC also reported that it could still be a problem for crypto to recover its credibility since reputation looks to be central to its valuation.
“It’s a 90% retail market, which means the sentiment of mom-and-pop investors really matters,″ Brian Brook, the CEO of Bitfury, and the former comptroller of the currency, said at this week’s CNBC Financial Advisor Summit. “And so when you read FTX stories on the front page of the Wall Street Journal, literally every day for the last 30 days…what it does is for relative new entrants, they get scared. And so as a result, liquidity is thinner than it would have been and people’s willingness to invest is lower.”
Meanwhile, FTX and a handful of celebrities including Larry David, Tom Brady, Giselle Bündchen, Shaquille O’Neal, Stephen Curry, and Shark Tank’s Kevin O’Leary were sued by FTX investors for deceptively encouraging consumers to invest in the company.
On November 11, the embattled crypto exchange FTX filed for Chapter 11 bankruptcy protection. Immediately after the news, the disgraced FTX founder Sam Bankman-Fried (also known as SBF) resigned as the CEO of the crypto exchange FTX Group and John J. Ray III was appointed the new CEO.
With each passing day, it’s becoming apparent that the FTX disaster is deeper than most people think. According to the court filings (see PDF below), FTX is a complex web of 134 corporate entities around the world, collectively referred to now as FTX Group. All of these 134 companies are now been put into bankruptcy.
Bankman-Fried first came into the spotlight in 2020 after he donated a whopping $5.2 million to Joe Biden’s campaign, making him the second-biggest donor.
Bankman-Fried founded FTX in 2019 with his co-founder Gary Wang. The Bahamas-based crypto exchange FTX offers derivatives products like futures and options as well as spot trading. Once an unknown startup, FTX has become a key player in the crypto space, rivaling the likes of Coinbase and Binance.