Crypto billionaire Mike Novogratz thinks it’s “really dangerous” to assume all digital asset exchanges are run like the now-imploded FTX.
The Galaxy Digital chief executive says in a new interview with CNBC that he always encourages crypto investors to “sell something along the way” to prepare for inevitable volatility.
Novogratz also discourages people from suspecting every player in the space operates like Sam Bankman-Fried, the disgraced former CEO of FTX.
“It’s really dangerous to think that when you have one black swan, you’re going to see them everywhere. That you’re going to have criminal organizations all over the place and these places are run by sociopaths. It’s just not the case. I’m not saying that every other exchange is playing by every single rule, right?
A lot of exchanges are under some assault from regulators for [know your customer/anti-money laundering] violations, often in the past. When they started, they didn’t have near as robust protections against who was using their exchange as they do now. But I don’t think under every rock there’s a guy stealing your money.”
Bankman-Fried was arrested by authorities in The Bahamas on Monday. Bahamian law enforcement carried out the arrest at the request of the US government.
The Department of Justice (DOJ) is charging Bankman-Fried with six counts of fraud, one count of conspiracy to commit money laundering, and one additional count of conspiracy to defraud the United States and campaign finance laws, according to a newly unsealed indictment issued by the Southern District of New York.
The fraud charges include conspiracy to commit wire fraud on customers, wire fraud on lenders, commodities fraud, and securities fraud.
The U.S. Securities and Exchange Commission (SEC) has also announced it’s charging the FTX co-founder with defrauding the exchange’s investors.
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