Crypto: redefining volatility

As crypto gradually becomes an institutional asset class, offshore lawyers are dealing with the casualties on the road to regulation

Following its dramatic collapse, the lack of due diligence and blatant disregard of red flags at FTX were self-evident to everyone; such is the wisdom of hindsight. The Bahamas-based platform – formerly the world’s second largest cryptocurrency exchange – had soared in value to a remarkable $32 billion by 2022 before depositors took fright at rumours of a black hole in its balance sheet: last November, FTX deposit balances fell by 87% in five days, culminating in FTX, its hedge fund Alameda Research and dozens of affiliates filing for Chapter 11 bankruptcy protection.