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And these to African Leaders have announced talks aimed at stopping, fighting in the eastern democratic republic of congo, a so called peace dialogue will be held in kenya on the member. The 21st announcement came as congolese force his battled rebels for control of the town of cuba. Well, those are the headlines. The news continues her and al jazeera. Thats after inside story. Ah what future do crypto curse is . Have after the full of f t x, the Exchange Platform has filed for bankruptcy, leaving thousands of clients in the dark. The immediate fallout was a sharp fall in the Digital Currency price. So what does this collapse mean for the industry and his investors . This is inside story. Ah hello and welcome to the program. Im hashem, abala, one of the Worlds Largest group to exchanges as its investigating hundreds of millions of dollars of unauthorized withdrawals, another se, millions of dollars worth of assets have been moved from the platform. After max file for bankruptcy on friday, it says it wants Legal Protection as it looks for ways to return money to customers. Former boss sam, bank man freed, has stepped down as chief executive, curb to prices have been sliding all year by the collapse of f t extends out the platform had earned the trust of more than 5000000 users worldwide. And traders more than 700000000000. 00 worth of crypto last year alone. Could her caresses have seen an explosion in popularity . Yes, rising to providence in 2009. Today, more than 20000 cook to caresses are being used. Thus more than double. Those in circulation last year, some of the major ones include bitcoin and ethereal. Last year the jointly made up more than half of the crypto market. The Digital Currency emerged as an alternative to money free from the control of governments and Central Banks. They are run across a network of computers and are under penned by Block Chain Technology by the industry has these challenges. Bankruptcies have come fast and furious since the middle of this year. The industry was once valued at roughly 3 trillion dollars. Its now worth about 900000000000. Ah, now lets bring in our gas in los angeles. Robert cap is the chief executive officer of g economics, a Global Economic and strategy Advisory Firm in singapore. Then and capron is the founder and director of corporate asia, an independent research and Consulting Firm focused on the agent, Financial Services industry in london, Glenn Goodman is consultant to the finance investment platform. It thorough and author of the crew to trade or walk up to the program. Gentlemen, i would like to unpack with you exactly what went wrong with after x and m. Is that with you, mr. Robert . What do you think was the main trigger for the collapse of f t x governance in in a single word . I, it seems that everything started right rattling of course, there was a lot other problems going on prior to this, but just a week ago i, it was revealed in a report that the at the ex exchange had been secretly shoveling funds and alameda research, a 2 entities owned by the founder, i stand by men freed. So it that, thats when it comes down to bad governance. It seems almost nonexistent oversight zed and so is the secret transfer of a customers funds from f t x all the way to alameda, another Company Owned by a by miss a free do you think that was a truck traditional case where people suddenly freak out decide to withdraw their cash, the company cannot really handle the rising demand, and there you go. The same crashing scenario. Sure. I think, you know, over the past couple months weve seen a number of notable classes in the crypto space. And so i think people are very aware of where there is smoke, theres probably fire. And so even when the 1st discussion problems came up, we started to see customer. Ill close and, and certainly that was a large part of the problem. But one of the Biggest Challenges is obviously the way that were using customer funds because it appears that they were putting it in to essentially what, what banks to, to a certain extent with fractional reserve and, and actually bending it out into much higher risk product category. Then we would expect to see an Exchange Used for Something Like that. So i think it was a combination of multiple errors, but certainly the customer funds was not helping the situation. Glenn, in this particular industry, the fact that she try to cushion against any losses or having an issue of liquidity, or transfer cash from a company all the way to another one which she own were ethically speaking. Is this something which is legitimate or no . Well, we dont know all the facts yet, and of course it depends partly on the jurisdiction where a company is based. And as we know at dx is an offshore company, its not american, its not european. Its based in antigua and the bahamas. So the question overly galaxy will be looked at and certainly the americans are sort of flexing their muscles, the c. C a getting involved, even the Justice Department might investigate. So well see what kinds if any, illegality was, was committed. But you know, legal questions. Aside in terms of the ethics of all of this, what i would say is it seems like sam, bank and fried, had that classic era of doing what a chorus did flying to close to the sun and getting his wings burned. We saw over the past couple of years, this guy rise from seemingly nowhere. Nobody had heard of him a few years ago. And then suddenly he is on the stage with bill clinton. Tony blair, which is albany, sharon, hes being haled, is one of the greatest philanthropists of the modern era. And nobody even heard of him 5 minutes early. So, you know, even while i was watching those things, i was thinking, this is a little bit strange and right. So incredibly quickly, how does this exchange become so enormous . So quickly and allegedly, it seems like the answer to that will be using huge amounts of leverage to grow much more quickly than would organically be the case. Robert in trying to understand the economics of crypto currency, the fall of disk, or the fall from grace for sam or bank man freed. Is this something that has to do with the way has been running the company . Or is it also different actors, particularly the seo of buying and so initially said who was willing to bail out of the company and then decided wait a 2nd. Im not going to go for the deal or just that answer itself. Yeah. Trigger this. Yeah, massive reaction. Well, theres a lot with optics, i like what the previous this constant mentioned how youve got someone who did kind of come out of nowhere. He does have a Silicon Valley pedigree. His father, a professor, bank man is well known legal and business scholar. At stanford university. And in fact, thats one of the things that the people now piling on to the company asking for answers are hoping that family might exert some pressure here. But you did have an interesting class of personality. So sam franklin read s b f as a, hes been known and 10 pung, jour, c z. You had these 2 kinds of acronyms, different personalities bagman breed was kind of more of the relax guy. He had testified before congress. He was seen as, its the most sort of reputable, i guess you could say he was, he was easy going. He speculated hed be able to biog Goldman Sachs and other, you know, just other element to this rise from obscurity into, you know, being the worlds biggest bank in the financial world. Ah, at least of an investment was the notion there. But anyway, yes, there was a lot of class of personalities by you know, the, the move by c z and finance to simply walk away from the deal without explanation. It did create that run. I guess i would go back to say, well, that was all rooted in governance good points also that you know, the scc and others want to get involved as a realizing what a mess this is as a huge my us investors, but its really a mess for Global Investors that and this has all the components of an american saga because just overnight and in pile. Fortunate reputation. All eviscerated. But when you look at the detail, the loose is really quite interesting. The clash between the 2 titans, c, z and and s b. Particularly when it comes to the moment when caesar decided that he is going to look into acquiring f t x looks into the balance. She said, that is a massive black hole here. He twits saying that im pulling out and we know what happened later was this, and that sounds bice easy to undermine the man who has been saying, who was biting him for quite some time. Yeah, it would seem to indicate that way. I mean, when we look at how changes are kind of proving their balances, there is no simple way of doing it. You know, i think what weve seen in the past couple of days as well. It since f t x really kicked off as a number of the other Crypto Exchanges claiming their proof of funds. And theres actually some questions about how theyre doing that in terms of, you know, we see a lot of large transfers that are moving between fund or between Crypto Exchanges, which could indicate that theyre actually pulling funds to kind of prove their reserves. And then theyre moving their funding to a different exchange. So indicating a certain amount of collusion within the exchanges. So there could be other things that are happening around there. But this is, this is certainly something thats been there for a while. And as was discussed earlier on, you know, i think when we look at the positioning that had, and you know, it was kind of seen this remarkable individual in the space. And its, its taught for a lot of people to have that proven wrong. But that really seems to be the case because a lot of the that were made must have been to a number of course, the time that really caused this to cause these issues and caused the claps. Glenn, wed like to understand what does it mean when f t expires for bankruptcy . What does it mean for the company itself and for the customers and for the massive black hole . Something like 9000000000 dollars. Well, the 1st thing id like to address is that the previous point the problem is that when with proof of reserves as a then i was saying is that you just get a snapshot. So would be interesting. It would be good to see some of these exchanges are showing their reserves in real time and that was kind of hinted at by c said, i think so, it would be nice. You know, if we could see a real time over time, then nobody would be able to do any clever shenanigans to do with moving money from one place to another and then back again or anything like that because we dont see it happening when you just have a proof of reserve snapshot one moment in time. Then obviously, you know, a company, im not indicating any company, but im just saying hypothetically, they could bump up their Balance Sheet assets as dental saying, and then move them somewhere else to another exchange. And then they could do this natural, we dont want to see any of that we want. We want sort of convincing proof would be wonderful. As for the bankruptcy or just to address that very quickly, this, the, you know, its going to be a long process. Of course, these things always are gonna work out what asset theyve got. What liabilities will start to find out what Companies Might be owed money by f t x. So then we can find out what kind of Companies Might actually be in trouble. Because obviously the entire market, bitcoin everything, all the prices have been pushed right down by the uncertainty of not knowing exactly where the liabilities are at. Which Companies Might be in more trouble than others as a result of but having in to linkages with f t x. Ok. Walbert. Usually when youre filed for bankruptcy theres always this understanding that potentially looking forward to see someone coming and building out the company. The ex has a new chief executive john j ray of the turnaround specialist. What can he offer . What can he do . Except for perhaps asking the american support or more, or of an aggressive regulatory apparatus to put an end to whats been going on with the crew to land. Actually, thats probably going to be the long term. And i honestly cant answer the question in terms of whats going to happen is bankruptcy. Or, you know, john, j is, is well known for restructuring enron. And that, that was much very structured. Thats more of a clean up. We saw this similarly with layman brothers. So often these sorts of bankruptcies, you know, theres so little left that there isnt a lot to necessarily restructure other than to get the platform kind of in order. I suppose the infrastructure and those asset hard hard asset parts of the Company Might be valuable to some others. There apparently was an Investment Bank at one time. Well indeed, even bias was looking to buy out f t x until they found out all these issues. But i think in to your point, yes, the long term implications are likely to be more regulation. So that will probably be the biggest impact to come out of this. The investors who put their money in depth its, i think theyre just wiped out. All right. Then as i would like to see now what would be the reverberations of what happened to f t x across the whole crew currency spectrum, what is going to happen next . It is still going to be the same period. Heather has been dominating the news over the last few years. I think thats the biggest question is, where do we, where do we go from here . And i think, you know, when you look across any of the players in the space its, its not good. Right . So institutional players that have been moving into the stage are likely going to be thinking things, you know, you have a lot of certainly here in singapore, you have a lot of private Wealth Managers that were moving in and investing client fund interviews. And some of them may have been using f t x custody of some of those outside for trading. You know, other institutional players that were just seeing what they could do in the crypto space. It does really set us back in many ways. And for retail investors, you know, i can just stick with what weve seen on the ground here in singapore. Obviously theres been a number of exchanges. Finance included that were pushed out of singapore because they werent fully licensed and want to go through that process. And so when, by man, well the f t x in many ways is very similar in terms of the breadth of coins that they offer, the trading mechanisms and products that are available on that. So many people move to f t x and now, now their money is gone. So there was a significant retail base in asia, not just singapore, but taiwan. Many, many large part of the losses. There were of f, the extra timeline and, and that really roads retail confidence. So where we go from here is, is really up in the air, but its, its certainly not a good sign. And its really kind of push the crypto industry back by a period of time. Many people have said years, potentially, glenn, if the greatest strength of a curb to curb, as it was basically this whole idea that a decentralized Financial System is going to prevail in the near future. And war just put an end to they had gemini, of the Central Banks and, and governments when you look at the very last few days, bite after the collapse of f t x. Suddenly have those stories about someone trying to 5. 00 and 370000000. 00 out of the accounts of f t x could be a hacker, be an inside work. Then more revelations, about the accounts in the bahamas being used by people all over the globe to try to salvage what the can do. Dont you think that could this is something that could push the world to think about the way this industry has been going because up so theres absolutely no trust here is its so frustrating from, you know, speaking of somebody whos been involved in the crypto world for many years now and believes that the sudden i believe that the centralization are using block chains can often be an extremely positive development. It is some frustrating to see the industry being industries, reputation being really damaged by this centralized entity, f t x. A Central Company run by a billionaire with big ideas. Its like totally antithetical to what credit to currency was supposed to be all about in the 1st, by whos present getting away from this whole billionaires running things and doing all kinds of secret things that nobody knows about. That was if you could tell it i find it really annoying and but ultimately the Silver Lining is. This was just a trading exchange, right. Its somewhere it dont. Its not chris. The currency itself, its the place people go to buy and sell credit cards. Hes the only one of the places you know, there are lots of other trading exchanges as well. So yeah, its frustrating because it was such a big company. And so many other companies were taken in and lend money and you know, there all kinds of linkages. And it all has to be unraveled. But by the same token, this isnt what crypt currency is for. Decentralized finance is the future as far as im concerned of people transferring critical axes, backwards and forwards, and that involves smart contracts, not billionaires in charge. Okay, robert on this very idea, im just picking up from where glen how left, which is curb to currency has been describing itself as the path to more equitable Financial System. Some sort of a far west a well, we dont have the traditional financial titans taken over by you end up having c z and youre having s b f and many others. Hook all the final shows which is anathema to what they preach initially. Now. Yeah. What, what glen was, you said, is it certainly correct . I read it but, but this brave like the whole problem i guess is that maybe its an element in that that the rest of the world starting with investors, individuals, institutions. The whole Financial System needs to get used to this idea of what we call d 5 d center, eyes finance. And thats not easy to do. And indeed the huge already is these personalities. I mean, we see this is with the notion of big tech eli mosque, who hasnt proven to be so genius like when it comes to marriage in a relatively straightforward social media platform. Granted, its issues were complex, but anyway, i e can revolutionize the Auto Industry but, but he cant manage of a preexisting i social media platform. It all gets back to what were talking about here. And that is, in this new territory, we gravitate to these larger than life figures. We, we want this sense of stability where were not use the fi, the whole idea of div i block chain distributed larger. And in all the transparency also, its again i go back to governance, the transparency and hearing that means that there has to be this whole notion of peer to peer of equal exchange. And that its, this hyper efficient mechanism of capitalism that were talking about, which is hasnt existed, weve always had big, you know, players, dominance monopolies or monopoly like behavior. And so thats the issue. I think people arent able to win themselves out of that old mold of thinking. And so we get these people who then do bad stuff. Ok said an in the cuff to land, you would have people trading a volume of 3 trillion us dollar, which has been knocked down to Something Like 900000000000. 00. Is. Is it normal, or is it an indication of an error that is about to come to an end . I think that this is a much bigger issue and were going to see about more contagion within the space. You know, there have been, as i mentioned before, you know, questions about the capitalization of other platforms. There are quite a few, not just retail but institutional players, but had money on us. So i think we were already in a bit of a what you might call a crypto winter, i guess within the phase, but its going to help coal there pretty soon because there is to be more contagion that comes out of this. And i, i wouldnt be surprised if this isnt the 1st. Theres a couple of exchanges that we see have trouble for various different reasons. And as mentioned before, you know, i think during this discussion its very difficult to tell when the tide goes out, whos swimming, make it, you know, in the traditional financial industry thats fairly straightforward because regulators have a really good graph dot maintain to monitor that on a regular basis, but with an encrypted space theres just thought about regulation or oversight to really see whats happening behind the scenes. You know, how they, how they make the secret thoughts. And so i think, i think were in for a little bit more term all over the next few weeks, months and potentially even years on us. Glenn, its quite interesting that this by all these problems, despite all the crunch people would still tell you that the adamant about the fact that crypt currency is the future of finance. Yeah, i will still tell you that. And as you say, lots of other people will say that and you know, the reason is, is quite straightforward is because it hasnt been done properly yet. You know, i know what the dream is. I understand how the centralized finance works. And ive been following it very closely and you know, theres a hell of a lot of potential. There is the best financial innovation that ive seen in, you know, 20 odd years, maybe longer. You know, since the, since really the advent on of derivatives i guess in the 19 eighties and then in the 990 s, you know, those with big financial innovations that cause a lot of problems. But also did a lot of good in other ways. Some lead the centralized finance actually goes back to what robert was just saying that really about people latching on to figure. I guess were human, we latch on so big human figures that we want to put our trust in. But you know, we do need to get away from that. The dream of the centralized finance is small contract is code is people buying and selling in ways that dont necessarily involve human intermediaries and dont rely on trusting in human intermediaries. And from the experiments that have been done so far, for the most part, it worked out very well. Yes, there are hiccups and some quite major helps, but its all experimentation and its all going quite well. And just one last point id like to make about regulation, just picking up on the exam was same that we do need good regulation, but it must be good regulation because there was a danger now with a lot of regulators are in my car and not fully understanding how these things work. They might over regulate d fi, which hasnt been the big problem and not do the right regulation on centralized exchanges. So far weve had centralized Exchange Regulation in the United States for the push like the trading business off. Sure. Thats why people were trading one f t x based in the bahamas because the exchanges that were based in the us like coin base were hampered in many ways by bade regulation. We need clarity, and we need sustain regulation for exchanges to stay in the main jurisdictions of people to trade in those jurisdictions. Quite a fascinating sort of, i have to admit that this is quite an uncharted galaxy as far as im concerned, and many other millions of people all over the world. But in the meantime, robert kept zone in capron and glen. Good, man, i really appreciate your insight. And thank you to for what you can see the program again. Any time by visiting our website, al jazeera dot com for further discussion goes on Facebook Page that facebook dot com forward slash ha inside. You can also, during the conversations with our 100, again say for hash model mother and the entire team here in doha bye for now. Ah a brazilian dictatorship for the democratically run football team. The corinthians changed the course of a nation. With the sent up was a revolutionary football known to locals, as the doctor football rebels concludes with the celebration of the life and legacy of socrates. And the corinthians, Democracy Movement on al jazeera ah al jazeera. When ever you as Climate Change heats up the planet, one scientist intends to take his back to the ice age to save the permafrost below he is reentered. You think animals to the grand slams above. Starting with the living creatures, the planning to resurrect an extinct species. Good is a freight save our wealth. Witness, museum of hypothesis on al jazeera. The. This is the face of hunger. To describe what is happening here as desperation, trivializes the extent of the suffering. Theres been a scramble at the supply truck because people here know that there is not enough for everyone, but they are still the lucky ones here across the way where the road has been completely washed away. Or people cut off from other villages as the trucks begin to empty panic with turns, and people jump the queue once again, making sure the weakest and the crown women children, the sick and elderly dont get pushed to the back of the law. Often requires force the