Kraken’s Jesse Powell says crypto community should ‘raise standards’ to put end to bad actors
Jessee Powell, founder and chairman of crypto exchange Kraken, shared her anguish over the collapse of FTX on her Twitter account, saying it’s time for the crypto community to stop trusting it too much and raise its standards. Said he came.
Powell’s 14-tweet thread called out to the entire crypto community, including investors, venture capitalists and regulators, to recognize the red flags and warn them to kick them out of the industry before it’s too late. I’m here.
Trust should be replaced with validation
Powell’s main focus was on the good and trustworthy nature of the crypto community. Due to the nature of cryptocurrencies and blockchains, those involved in this field have a desire to be genuinely useful and to innovate for the better.
2/ Our good and trustworthy nature makes us easy targets for fraudsters. Some outspokenly say they are here for profit, not crypto. We appreciate their honesty.
But we’re surprised when they turn out to be who they say they are.
— Jesse Powell (@jespow) November 10, 2022
Powell also said the community is vulnerable to scammers. As Powell explained, these people don’t hesitate to “sell us out for their own gain” while “we let the clowns come under our flag.”
Powell said the past few months have been brutal for the cryptocurrency industry, referring to the Terra-LUNA crash in May. An implosion of cryptocurrency exchanges would be like a gift to all bitcoin haters, fueling their claims for the cryptocurrency. He said it would take years.
Venture capital is also responsible
Powell then accused the venture capital firms of failing in their “obligation to be critical and to withhold undue praise.”
8/ I am aware of the fact that the VC wrote the check blindly. why? Because it was profitable. Were they sustainable? Were they bleeding money on the other side? Was it all based on untenable self-trading setups, front-running clients and embezzlement of user funds?
— Jesse Powell (@jespow) November 10, 2022
Powell listed nine red flags about FTX that venture capital firms should have noticed.
After entering the battle eight years late, FTX acted like they had it all figured out, spending nine figures on “ego” purchases like buying political influence, concluding sports deals, and more. FTT is one of these red flags.
legislators get their fair share
Finally, Powell turned his attention to US lawmakers and said they were also accountable for the FTX crash.
He said they have refused to provide “a viable system by which these services can be provided in a supervised manner.”
According to Powell, this has led to the expansion of businesses like FTX into offshore lands, resulting in the current situation.
Powell said lawmakers should focus on offshore exchanges instead of “falsely focusing on convenient onshore good actors” as they do now.
Kraken remains safe
Powell concluded by assuring the community that Kraken has not been exposed to FTX or FTT. He said that the Kraken prioritizes survival over profit, and shared his good fortune with those affected by the recent series of events.
He said:
“Thankfully, @krakenfx It had not been exposed to any of the recent disasters. We aim to provide our clients with access to cutting-edge crypto products, but take a very conservative approach to business operations, security and financial resilience. Survival & mission over profit. ”
