Lessons From FTX FIASCO: Ripple CTO, David Schwartz Wants Us To Never Forget This

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With all that has happened with FTX, one would expect that everyone has at least learned a thing or two. However, the CTO of Ripple Labs has stated that despite all that has happened, he strongly feels that the most important lesson will be overlooked by many.

On Monday, the 21st of November, the CTO, David Schwartz, took to Twitter to air his opinion following the FTX crash less than 2 weeks ago. He believes that when there are no proper regulations put in place, mishandling of such a huge amount of money is just inevitable because when you’ve been holding on to so much money for so long, you will not be able to resist the urge to touch some of it.

In his own words, he stated that;

There’s one important lesson that is really pretty obvious in retrospect and that I can say with total confidence will not be learned.
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He further stated that

“If you hold billions of dollars of other people’s money for indefinite time periods, the temptation to speculate with those funds is irresistible if there aren’t verifiable checks that make such risk-taking virtually impossible, nothing else will be sufficient.”
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This kind of thing will always happen unless it cannot happen,” he stressed. “The temptation is irresistible. That is one of the most important lessons of FTX. But most people will actively choose not to learn this lesson because of, among other things, the elephant in the room.
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I do agree with his opinion on the subject matter to a tangible extent. I mean, FTX has indeed been in the news for terrible reasons. And, with every single day, more shocking details are revealed.
In fact, there are rumors that the owner may be charged in the long run, depending on what the investigation reveals. Different authorities are currently investigating in different countries for mishandling customers’ funds.

Below is a list of some of the organizations

• investigating FTX
• Commodity Futures Trading Commission (CFTC)
• Bahamas securities regulator
• Turkey‘s financial intelligence
• The Securities and Exchange Commission (SEC)
• Department of Justice (DOJ) in the U.S

Ripple Labs is currently engaged in a lengthy lawsuit with the SEC. The securities regulator sued the company, its CEO Brad Garlinghouse, and co-founder Chris Larsen over the sale of XRP, claiming that the crypto token is a security. Garlinghouse expects an answer in the first half of 2023. The Ripple CEO recently said that the crypto industry will be stronger after the FTX fiasco if we keep focusing on transparency and trust.
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Lastly, the CTO has also stated that he believes cryptocurrencies will get better once the FTX brouhaha blows over. And, I hope it does!

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