I Predicted FTX's Collapse A Month Before It Happened

There were plenty of warning signs to alert investors to behind-the-scenes issues at FTX.

The FTX collapse showed that where there is smoke, there is fire.

In a year filled with jaw-dropping unveilings, nothing compares to the baffling fall of Sam Bankman-Fried's FTX exchange. Although many were stunned, there were a few telltale signs that perhaps all was not perfect at FTX headquarters.

These problems began to escalate, and on October 5, I posted a detailed commentary on my decision to start withdrawing funds from FTX and bypassing FTT.

I'm withdrawing all my capital from @FTX_Official and I'm out of $FTT

FTX has been swinging and disappearing all year on so many activations

AND

Something fishy is going on at FTX.

Here are 12 reasons why I am completely disconnected from the FTX mafia and @SBF_FTX:

[1/20] pic.twitter.com/ECrhQn5Rjx

— Ishan B (@Ishanb22) October 5, 2022

In the end, things didn't seem right. A month later, we are witnessing the fallout.

This is not meant to be a victory lap, but rather an opportunity to learn from our collective mistakes and create the systems necessary to prevent this level of fraud from happening again.

Now we have strong allegations that what happened constituted fraud - at the highest level, by the least conceivable part. Here are some reasons why these circumstances were foreseeable and how they can be corrected in the future.

Departure of senior executives

While the hindsight is 20/20, FTX's streak of top executive departures should have been a giant red flag. Alameda Research CEO Sam Trabucco announced his resignation on August 24, followed by FTX US CEO Brett Harrison on September 27. O...