Three Years After Ftx’s Collapse, Creditors Wait As The Industry...

The 2022 FTX bankruptcy pushed crypto toward greater transparency across exchanges and DeFi, yet some who lost funds in the crisis still haven't been paid.

When FTX filed for bankruptcy on Nov. 11, 2022, it sent shockwaves throughout the crypto world, erasing billions in market liquidity and shattering confidence in centralized exchanges.

The dramatic collapse became a turning point for the digital asset industry, triggering calls for stronger transparency and reactions from regulators.

Three years after the exchange’s collapse, transparency initiatives across the crypto industry have proliferated. Proof-of-reserves attestations, audits and onchain analytics represented progress. Still, many of those reforms remain works in progress, and some of FTX’s creditors have yet to be made whole.

Centralized exchanges bore the full impact of the post-FTX crisis of confidence. In the weeks following the bankruptcy, users withdrew more than $20 billion from major trading platforms, according to CoinGecko data.

In response, exchanges began publishing proof-of-reserves (PoR) attestations to demonstrate solvency. Binance released its first report on Nov. 10, 2022, followed by a Merkle Tree-based report a few days later that allowed users to verify its Bitcoin (BTC) holdings.

Around that time, OKX, Deribit and Crypto.com all published proofs-of-reserve amid fears of contagion and uncertainty surrounding crypto exchanges.

While these efforts offered some visibility into reserves, most relied on snapshots rather than continuous audits and often drew criticism from the crypto community.

One X user, David Gokhshtein, said at the time that publishing proof-of-reserves wasn’t enough. “When you aren’t showing the company’s liabilities, it means nothing,” he wrote.

Thomas Perfumo, Kraken’s global economist, told Cointelegraph that the “hard lessons of the past were never an indictment of crypto,” adding that the FTX debacle reinforced the “governance and integrity matter.”

Source: CoinTelegraph