FTX.com – Fact & Fiction of a money run

Before we dive deeper into this, I may have to explain what a unicorn is. A unicorn is a privately held startup company valued at 1 billion USD. In traditional startup land, it is not so common to get to this valuation, and it needs some hard work sweat and tears to go there. For companies like uber, it took around 4,5 years to become a unicorn for Airbnb it took around a timeframe to become one.

Unicorns at speed
Looking into the crypto and blockchain space, one of the first unicorns was Coinbase which raised a 100 Million USD at a 1,6 Billion Dollar Valuation. Coinbase was founded in 2012 and reached that status in the cryptocurrency craze of 2017. Binance toped this, and within a few months (around 6. month) of launching, they achieved unicorn status. Binance is as well profitable and can be considered the fastest profitable startup which achieved unicorn status. It’s valuation is now considered to be somewhere around 2 Billion Dollars USD. As of late 2019 Binance just crossed the 1 Billion mark in cumulative profit with bringing in 183,5 million USD in Profits only in Q3 2019.

Enter the Next Wave
Entering FTX which is a derivatives trading platform which launched its operation in Mai 2019 by Alameda Research. Having initialy done an ICO for there FTT token which washed in around 8 Million USD, they as well got additional funding in the tens of millions from CZ aka Binance. In December of 2019 they claim to have a daily trading volume of nearly half a billion USD across all of there products.

1 Billion Valuation here we come
Having just announced in early 2020 options into there offering a new funding round is up and ahead. This time in the form of a public sale for tokenized equity issued at a valuation of 1 Billion USD. Each FTX_Equity token is valued at 2USD, and it is estimated that they plan to get in an additional 30 to 50 Million USD. By raising an amount like this, they exchange equity for around 3% to 5% and validate with this the 1 Billion dollar valuation.

Fact or Fiction
I am getting it that the Blockchain and Cryptocurrency space is hot and particularly companies which are providing exchange services. We have seen it with the likes of Kraken, Binance, Coinbase etc in the past. All of those companies have proved they can catch the momentum and get users and maintain as well have a consistent user base. Taking a closer look into FTX shows that they are in terms of users still on the lower end and a large amount of “Phantasie” is priced in this 1 Billion dollar valuation.

Personal Statement
I am a firm believer in the blockchain and cryptocurrency space but what is happening with this ultra fast-growing unicorns is not healthy. In my opinion and I may be wrong, but it looks like, companies are specifically built and pumped up. It is almost like getting those high valuations for early-stage companies with the idea intent to flip them as fast as possible.

In the end, we are living in a free world, and I belive and like the startup spirit etc, but this is like Capital and Company building on Steroids where most likely we maybe see another “disaster” like the one with WEWORK. Interesting is that cycles have accelerated and things are happening much much faster than just half a decade ago. #Moneyrulztheworld #Speedkillscompetition