Galaxy Digital CEO Mike Novogratz says SBF should be jailed

In an exclusive interview with CNBC, Galaxy Digital CEO Mike Novogratz called the FTX debacle a confidence crisis, claiming the incident caused a lack of trust across financial markets.

Novogratz described SBF’s character as delusional and prone to hype, and called the FTX case a criminal account and propagators worthy of prosecution. The Bitcoin whale has argued for the need for tougher regulations on digital assets, especially after his SBF exchange collapsed.

“It was delusional. Let’s be really clear. Sam was delusional about what happened and his responsibility for it. @ Novogratz“He needs to be charged. He’s going to spend time in jail. And it wasn’t just Sam. You can’t pull this off alone.” pic.twitter.com/0SSh1r8XIL

Squawk Box (@SquawkCNBC) December 1, 2022

According to Novogratz, the cryptocurrency market has failed to regulate itself in an industry where everything depends on building trust with customers.

In an interview with CNBC, Novogratz argued, I think the financial side of cryptocurrencies companies like ours that buy, sell, lend, and do derivatives will and should be regulated.

He thought that as a result of the fiasco, people would think there were “black swans” around every corner, or that sociopaths would deliver something different than they had promised.

T.The CEO also talked about the gross mistake that FTX does not have an internal accounting department, cluttering the exchange’s balance sheet and confusing the financials of both FTX and Alameda.

While other exchanges have explicit terms on how customer funds are used or stored, with FTX, instead of separating individual tokens and accounts, Alameda Research separates customer funds and trading. I was able to do.

Novogratz suggested that a digital asset platform should have clear terms and never lend out a customer’s money without asking for the customer’s permission.

Meanwhile, the investor also expressed his belief in Bitcoin’s positive future, saying that Bitcoin, Ethereum and the blockchain will survive the FTX crash. It warned about the timing and urged the industry to remain vigilant.