Pantera Capital reflects on FTX situation and importance of DeFi in latest Blockchain Letter update
Pantera Capital CEO Dan Morehead posted a tweet late last night about the impact of the ongoing FTX situation and how Pantera underlines the importance of what they are building.
FTX emphasizes the importance of what we are building here: a more efficient, decentralized and open financial ecosystem.
as my Co-CIO @joeykrug “The journey may not always be easy and smooth, but it is necessary.”
This week’s thoughts: https://t.co/WH3YJLBeVD
— Dan Morehead (@dan_pantera) November 11, 2022
Morehead’s statement is detailed in the latest update of Pantera’s “Blockchain Letter.” This is a monthly letter covering a variety of topics, primarily focused on and around the blockchain ecosystem.
The latest additions to the Blockchain Letter, updated Nov. 11 by Pantera Co-CIO Joey Krug, summarize the impact and permanent capital loss mitigation for FTX and Alameda Research.
“Our approach to situations like this is primarily focused on protecting our portfolios as much as possible.”
Pantera aims to minimize “exposure to typically centralized counterparties” while maintaining trading flexibility.
The company has addressed concerns surrounding its exposure to FTX events, explaining that the main “risk/loss” comes from the Blockfolio acquisition proceeds.
“On Tuesday, November 8th, we liquidated this FTT as best we could. On the Monday night before the collapse, our FTX Equity and FTT Token positions were less than 3% of our total AUM.”
Pantera speculates on possible regulatory response after quickly implementing precautionary measures in the wake of FTX and Alameda, but is “cautiously optimistic about positive results in the medium to long term” .
Reflecting the situation, Pantera has identified a “need for a decentralized, trustless protocol that allows users to trade, hold and transfer assets without relying on entities such as FTX, Celsius or Voyager.” I am emphasizing.
The need for a centralized intermediary was acknowledged in the Blockchain Letter, suggesting that such entities would likely be “subject to greater scrutiny of reserves, audits, and risk management.” doing.
“On a personal level, the implosion of FTX is a reminder of what we are doing here. Our mission as a company and as an ecosystem is to Avoid repeating risks and inefficiencies: build a more efficient, decentralized and open financial ecosystem.”
