FTX Token
Crypto Overview
Overview
FTX Token (FTT) was the native cryptocurrency of the now-defunct FTX cryptocurrency exchange. The token was created by Sam Bankman-Fried and launched in 2019. The intended utility of FTT was to serve as the backbone of the FTX trading ecosystem, offering holders trading fee discounts and other platform benefits.
Intended vs Actual Utility
The intended utility of FTT included reduced trading fees, collateral for futures positions, and participation in platform governance. However, investigations revealed that FTT was primarily used as collateral by Alameda Research (FTX's sister company) to borrow billions of dollars, artificially inflating its value.
Business Model Assessment
The actual business model deviated significantly from its stated purpose. FTX and Alameda Research were found to be misusing customer funds, with FTT tokens being used in ways that violated basic principles of transparency and trust. The exchange collapsed in November 2022, leading to criminal charges against founder Sam Bankman-Fried.
Token Distribution and Founder Enrichment
Investigation revealed that a significant portion of FTT tokens were controlled by FTX and Alameda Research. The token distribution was highly concentrated, with the founding team maintaining substantial control. The project demonstrated clear signs of being used to enrich founders through fraudulent means.
Development and Marketing
While FTX maintained a strong marketing presence, including numerous high-profile sponsorships and partnerships, the underlying technology and token utility were not prioritized. The focus was primarily on marketing and expansion rather than sustainable development.
Crypto Impact
To assign a comfort level investing in FTX Token from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to FTX Token.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.