LUNA Is Not Quite A Scam, Says FTX CEO Sam Bankman-Fried
LUNA Is Not Quite A Scam
Terra’s (LUNA) collapse, according to the CEO of crypto exchange FTX, was due to poor marketing rather than outright deception.
According to Sam Bankman-Fried, comparing the downfall of LUNA and its stablecoin UST to that of former healthcare unicorn Theranos is unfair. Terra founder Do Kwon, according to Bankman-Fried, did not defraud investors.
“Now, LUNA/UST were bad, and ended badly! So did Theranos. But the core accusation against [founder Elizabeth] Holmes isn’t that Theranos failed. Startups fail all the time. The accusation is that she lied.
In particular, she said that Theranos was doing specific things that it wasn’t doing; the fraudulent behavior was her pretending to investors that one type of test was another.
LUNA is different. The LUNA/UST mechanism wasn’t misrepresented – it was, in fact, very transparent. And, I think it was transparently going to falter at some point. Do Kwon obviously stood by it, morally and in terms of press, long after he should have backed off.”
While Do Kwon is not a fraudster, Bankman-Fried believes Terra’s marketing moves should have done a better job of informing investors that UST was not completely backed by US dollars.
“[Kwon] didn’t claim that UST was backed 1:1 by USD. He claimed, accurately, that it was backed by a bunch of volatile assets. It was very publicly clear that those assets might go down, and the rest followed. Again, I don’t want to condone the behavior. But it’s different.
Luna was a case of mass enthusiasm, excitement, and frankly – marketing and memes – driving people to believe in something which was going to falter according to publicly available information. That marketing was probably bad. But it wasn’t the same type of bad as Theranos.”
Bankman-Fried goes on to claim that disastrous investments aren’t always Ponzi schemes, citing major firms with 50% stock price drops, such as Netflix, AMC, and Cathie Wood’s ARK Innovation ETF.
Coincu will continue to update the situation related to SBF, you can find out more information through this article.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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Hazel
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LUNA Is Not Quite A Scam, Says FTX CEO Sam Bankman-Fried
LUNA Is Not Quite A Scam
Terra’s (LUNA) collapse, according to the CEO of crypto exchange FTX, was due to poor marketing rather than outright deception.
According to Sam Bankman-Fried, comparing the downfall of LUNA and its stablecoin UST to that of former healthcare unicorn Theranos is unfair. Terra founder Do Kwon, according to Bankman-Fried, did not defraud investors.
“Now, LUNA/UST were bad, and ended badly! So did Theranos. But the core accusation against [founder Elizabeth] Holmes isn’t that Theranos failed. Startups fail all the time. The accusation is that she lied.
In particular, she said that Theranos was doing specific things that it wasn’t doing; the fraudulent behavior was her pretending to investors that one type of test was another.
LUNA is different. The LUNA/UST mechanism wasn’t misrepresented – it was, in fact, very transparent. And, I think it was transparently going to falter at some point. Do Kwon obviously stood by it, morally and in terms of press, long after he should have backed off.”
While Do Kwon is not a fraudster, Bankman-Fried believes Terra’s marketing moves should have done a better job of informing investors that UST was not completely backed by US dollars.
“[Kwon] didn’t claim that UST was backed 1:1 by USD. He claimed, accurately, that it was backed by a bunch of volatile assets. It was very publicly clear that those assets might go down, and the rest followed. Again, I don’t want to condone the behavior. But it’s different.
Luna was a case of mass enthusiasm, excitement, and frankly – marketing and memes – driving people to believe in something which was going to falter according to publicly available information. That marketing was probably bad. But it wasn’t the same type of bad as Theranos.”
Bankman-Fried goes on to claim that disastrous investments aren’t always Ponzi schemes, citing major firms with 50% stock price drops, such as Netflix, AMC, and Cathie Wood’s ARK Innovation ETF.
Coincu will continue to update the situation related to SBF, you can find out more information through this article.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join CoinCu Telegram to keep track of news: https://t.me/coincunews
Follow CoinCu Youtube Channel | Follow CoinCu Facebook page
Hazel
CoinCu News
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