Cryptocurrencies can pitch in generating revenue rapidly but they can also trigger loss at a similar pace as well. Several Crypto giants fall every year and due to this, they cause strain on the funds of various crypto investors. Crypto prices have fluctuated by a huge sum as there are various crypto firms that have eventually crashed to bankruptcy this year.
The most significant giants that have emerged in the crypto news include FTX, indulging in fraud with its clients. Moving forward companies like Voyager, Terra UST, and Luna crypto have also been thrashed out of the market this year.
Crypto Exchange Companies That Collapsed in the year 2022:
- FTX
- Three Arrows Capital (3AC)
- BlockFi
- Vauld
- Terra USD (UST)
Let us now dig in details on cryptocurrencies failure in 2022;
FTX
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FTX was among the most gravitated news in crypto market this year as the ex-CEO of FTX crypto Sam Bankman-Fried was alleged in fraud of multi-billion dollars that caused liquidation of funds of the company in no time. Sam allegedly transferred funds from FTX to its sister company Alameda Research and the transactions revealed movement of $6 billion in just 3 days.
The company faced a crucial downfall after the incident causing them to liquidate all their funds and the company went bankrupt. FTX ex-CEO was one of the youngest billionaire in the world with worth of $32 billion that turned into dust soon after the incident.
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Three Arrows Capital (3AC)
3AC cryptocurrency firm was at debt of $3.5 billion from around 27 companies including Voyager. Three Arrow Capital is a Singapore based firm that started in the year 2012 by Kyle Davies and Shu Zhu. The firm was alleged of the delegations soon after the report was filed against FTX.
Crypto Briefing
The firm faced allegations against them that referred that they were involved in fraud, mismanagement and were reported under Chapter 15 Bankruptcy in July 1.
BlockFi
BlockFi has gained fame for competing with other cryptocurrencies firms like Voyager Digital Ltd and Celsius Network. The company dodged various allegations but soon got trapped under Chapter 11 for bankruptcy.
The Block
BlockFi has commenced a policy where its users can withdraw funds have non-interest-bearing BlockFi Wallet accounts, which BlockFi established earlier this year as part of a $100 million settlement with the Securities and Exchange Commission.
Also Read: KYC In Cryptocurrency: What Are The Benefits, Risks And Challenges Involved With It
Vauld
Vauld is one more Singapore based cryptocurrency that has fell under the fraud and bankruptcy claims this year. The company faced crime derived for predatory lending firms. Moreover, the company sued their users from liquidating their funds few days prior going bankrupt.
Vauld mitigated total funds of amount $363 billion by the time the company fell to dust. The United States authority has frozen funds worth $46.4 million of Vauld company in August 2022.
Terra USD (UST)
This has been a rough year for UST owners as they have faced loss even after they tried lifting up their company by using crypto funds from their sister company Luna. The aid didn’t assist UST instead carried LUNA along with them and resulting in leading them towards bankruptcy as well.
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Terra USD (UST) was uplifted in between as Terraform purchased $2 billion UST crypto coins but the firm soon liquidated all the funds and later fell to the cause leading them to crash.
Also Read: Crypto Lender Vauld Rejected Nexo’s Offer Over Potential Procurement!!
In the world of cryptocurrencies, various billionaire firms have faced a downfall in the year 2022. The cause implicates a very generous report that the investment in cryptocurrencies is highly unpredictable and even the potentially flourishing crypto giants may face downfall and go bankrupt.