The co-founder of the decentralized blockchain of the first level Tezos believes that the wave of defaults of crypto companies has proved the unviability of projects designed only for profit growth.
Kathleen Breitman said in an interview that the bankruptcy of troubled crypto lender Celsius Network was predictable, as such business models are highly unsustainable in the long run.
“Everyone who has been in the industry for quite a long time was not at all surprised. In the economy, contrary to popular belief, there are laws that go beyond the blockchain,” says Breitman.
Overall, recent events have been more or less predictable, according to the Tezos co-founder. The insolvency of Three Arrows Capital suggests that the cryptocurrency hedge fund crisis was “uniquely bad.” Brightman is confident that crypto companies that faced a financial crisis due to the collapse of Terra or a wave of defaults were in fact not viable:
“You can’t build a sustainable protocol or business based on the theory that the numbers will always go up.”
Cryptocurrency lender Celsius unexpectedly filed for immediate bankruptcy in the Southern District of New York after paying off debts. A New York federal court has frozen the remaining assets of cryptocurrency hedge fund Three Arrows Capital shortly after the company filed for emergency bankruptcy. A wave of crises covered crypto companies after Terra faced default in a falling market. Companies connected directly or indirectly with the project faced losses that put their existence at risk.
Source: Bits
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