Tether co-founder: FTX’s bailout of crypto firms is for the ‘good’ of the industry
- Reeve Collins is the CEO of crypto platform BlockV and co-founded stablecoin issuer Tether.
- He says crypto firms in trouble represent DeFi 1.0, which exploded as crypto rallied in 2021.
- While it's inevitable for some to fail, backing from FTX could give some a second chance.
Reeve Collins, co-founder of Tether and current CEO of BlockV, an NFT-focused platform, says the problems affecting crypto companies today are the “inevitable missteps” that will eventually give way to success and growth.
Speaking in an interview with CNBC published on Monday, Collins talked about the emergence of decentralized finance (DeFi) and the many companies that cropped up.
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He says as the industry exploded during the bull market, providers had to step in with products offering yield, loans and other blockchain-based financial services.
“It’s inevitable at the start of any industry that there’s going to be a lot of missteps and some failures [and] that’s what leads to growth,” he said.
FTX brings in “good money”
The Tether co-founder believes FTX’s is putting in “good money” to try to save companies that didn’t utilize what they had well.
“It’s great that FTX is actually stepping up because they have the war chest to actually say OK you guys had a great audience, you had a great product for a while [but] it didn’t work out, lets step in and take you to the next level.”
According to him, a backer like Sam Bankman-Fried’s FTX could offer some of the flailing crypto firms a second chance.
The crypto industry has seen several companies within the decentralized finance (DeFi) sector hit trouble following a tough crypto winter.
The likes of Celsius Network, Three Arrows Capital (3AC), Voyager Digital, Babel Finance, and BlockFi are among the big ones to hit turbulence as the rough market conditions panel beat projects.
BlockFi and Voyager have received bailout packages from FTX.