More crypto firms from all around the world are coming out to announce they've been affected massively by FTX collapse and with every passing day, teh crypto community seems to be unwrapping more negative effects the collapse has on the entire crypto market. Alas the crash of FTT and and initially crash in market were just some of the early effects of the collapse and it does seems like it might take a while or the crypto industry to readjust. But while we pick up ourselves and rebuild, there are some key lessons we should grab from FTX ill fate as we move on from here.
1. Always Choose Decentralisation:
Cryptos represent freedom and were invented to eliminate the reliance on centralised bodies and a third party. Your cryptos are meant to be controlled by only you, and when we trusts individuals with our assets instead of transparent codes that will never change, we are at the risk of becoming victims of events like the FTX crash. Storing your cryptos on decentralised platforms like Hive, You and only you having the keys to your wallets and being in total control of your assets are the best ways to enjoy the freedom cryptos give and that in my opinion is the biggest lesson from the FTX collapse.
2. We Need More Regulations:
Please hear me out first. I believe regulations will help bring decorum and will sanitise the crypto space. I mean just look around, every day it's one scam or the other, everyone once a while it's a big hack or crash, and cryptos still have a reputation for high risk and this isn't just about volatility. Regulations are what protects investors from being victims of bad models like FTX and LUNA. They wouldn't be in the game if they knew there would be consequences for their actions, these guys just messed things up for millions of people and act like it's nothing. Regulations will make compensations and refunds possible, serve justice, and would keep firms and individuals with bad intents out of the space. I don't support any form of regulation that hinders the use of cryptos however, but we need some forms of protection here to also make the space more appealing to potential investors.
3. Diversification Is Key:
This is something I learnt the hard way in my early days when all I had was lost in Cryptopia crash. I left the crypto space for a while because I couldn't imagine how such could happen and nothing was done to at least compensate the loss. Since then, I've learnt to never put all my eggs into one basket. Diversifying will save us from being massively affected by events like the FTX and LUNA crash. It's a safe way to thread the risky streets of crypto and a great way to invest.
I hope those affected by these unfortunate events recover fast from them and I do hope we don't get any more of these again.
Two main lessons I can see...
Don't trust centralized exchanges and be wary of Stable Coins with companies that aren't well known.
Yeah friend, you're so damn right.