While the crypto world continues to navigate the fallout from the collapse of FTX, Ava Labs says it dodged the bullet.
“We had very little exposure, and we’re grateful for it,” Ava Labs founder and CEO Emin Gün Sirer told Decrypt. “We ended up having very little to do with this, this is entirely outside of us, and it turns out it impacts very little the companies and projects operating in the Avalanche ecosystem.”
Launched in 2018, Ava Labs is the company behind the Avalanche Network. Ava Labs built the Avalanche blockchain on the promise of extreme scaling capabilities and fast confirmation times.
In a Twitter Spaces chat with Decrypt on Wednesday, Sirer said he is “relieved” that Avalanche had little exposure to the exchange, but acknowledged the macro damage done by FTX and its then-CEO Sam Bankman-Fried.
Gün Sirer said the blowback goes back further than when the company filed for bankruptcy on November 11, or when Bankman-Friend allegedly opened a back door to funnel funds to his hedge fund Alameda Research.
“Sam’s damage did not start last week,” Sirer said. “It started when they started doing these ponzitronic things to pump certain coins at the expense of others.”
GM to everyone who did not engage in fraud and create market mispricings and illiquidity problems for others.
Sirer said the real problem began when Bankman-Fried engaged in market manipulation to prop up the value of certain coins on paper in order to borrow against them. “That’s the damage he did to us,” Sirer said. “It’s not insignificant, but I think we were generally spared in this final crash.” The company had an account on FTX with a very small amount of coins in it.
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Impossible for anyone to have zero exposure to FTX
Still, “very little exposure” is not the same as “no exposure.”
Emin Gün Sirer said that he doesn’t say “no exposure” because everyone in the industry is affected by a meltdown this massive.
“I don’t say none because it’s impossible to say none,” Sirer said. “If I were to say that, it would be wrong… If you are a player in this industry, you are in some way touched by it. So I don’t want to speak in absolutes.”
Literally every single Samcoin investor would do it all over again. No one got into a Sam operation for its decentralization or adherence to crypto principles. https://t.co/SVho9NG7dj