Nayib Bukele Defends Bitcoin and Calls FTX a “Ponzi Scheme.”

In Brief

• El Salvador President Nayib Bukele said on Nov. 14, 2022 that there is still time to prevent crypto scandals like FTX, because it is still early days for crypto adoption.
• Bukele compared the FTX debacle to the Bernie Madoff saga and a Ponzi scheme.
• After the FTX bankruptcy, Binance CEO Changpeng 'CZ' Zhao confrimed that Bukele had no BTC holdings on FTX.

El Salvador president Nayib Bukele compares the FTX exchange to a Ponzi scheme and hails Bitcoin’s scarcity and deflationary properties.

Bukele lumped the Bernie Madoff case, Enron, WorldCom, and Sam Bankman-Fried’s collapsed FTX exchange in the Ponzi or crypto pyramid scheme category.

Accordingly, the Salvadorean president tweeted, “FTX is the opposite of #Bitcoin. BTC. The protocol was created precisely to prevent Ponzi schemes, bank runs, Enron, WorldCom, Bernie Madoff, Sam Bankman-Fried… bailouts, and wealth reallocations. Some get it, others still don’t. We are still early.”

He added that people become victims of collapses like FTX’s because of unfamiliarity with Bitcoin and its ecosystem. Despite this lack of understanding, he believes there is still time to use Bitcoin to avoid failures like FTX.

FTX saga expands internationally
Between FTX filing for Chapter 11 Bankruptcy and the exchange being hacked, Binance CEO Changpeng ‘CZ’ Zhao tweeted that Bukele did not hold Bitcoin in an FTX account, calling the information erroneous and unsubstantiated.

Bukele drew criticism from the International Monetary Fund for making Bitcoin legal tender in the South American nation in 2021. According to Bloomberg, El Salvador owns 2,381 Bitcoin, which has fallen 60% in value amidst the extended crypto winter.

The FTX saga continues to snowball internationally, with authorities in the Bahamas launching an investigation into the defunct exchange.
According to a statement on Sunday, Nov. 13, 2022, the Royal Bahamas Police is investigating the possibility of “criminal misconduct” by FTX.

“In light of the global collapse of FTX and the provisional liquidation of FTX Digital Markets Ltd., a team of financial investigators from the Financial Crimes Investigation Branch is working closely with Bahamas Securities Commission to investigate whether any criminal conduct occurred.”

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