Harvey Dent turned into Two-Face

Harvey Dent turned into Two-Face.

Crypto's White Knight is gone forever.

Sam-Bankrun Fraud Bankman-Fried was seen as the intermediary between the crypto industry and policymakers in Washington. FTX was perceived to be one of the highest quality exchanges.

SBF had a leadership position as somebody worthy of testifying before Congress on the behalf of the industry. And likely attempted to shape legislation that favored his agenda, which seemingly pissed off his largest competitor and came back to bite him.You can see the video below of SBF testifying before Congress. He opines on the 2008 financial crisis being caused by a lack of transparency. But on his platform, "there's complete transparency and a robust, consistent risk framework applied."

Needless to say, he was completely full of shit.

The Wall Street Journal is now reporting that Binance will likely walk away from the deal to acquire FTX.

The details are complicated but the reality is very simple.

FTX took customers funds held on FTX, transferred those funds to a hedge fund they controlled, speculatively traded in obscure assets with the funds, lost a substantial amount, and when customers wanted their money back, FTX didn't have it.

When Binance opened the FTX books, they found themselves staring into a financial black hole. Bloomberg is reporting "that hole" is roughly a $6 billion loss.

In short, there's likely nothing for Binance to save.

The SBF empire - celebrity sponsorships, splashy media deals, stadium naming rights - is all gone. It unraveled inside a week. A $32 billion company went to $0 with no stops in between. Completely unprecedented.

Institutional adoption has been a narrative building for years in crypto-land. The last 48 hours likely sets it back years, maybe longer. One example: the Ontario Teachers Pension Plan was an equity investor in FTX and participated in their January fundraising round. Their investment will be written down to $0. Will they ever invest in crypto again? It seems unlikely.

Financial advisors has been another vector that crypto has pointed towards driving future adoption. Most financial advisors don't pay attention to crypto's inner workings but they certainly read headlines. The "headlines" in crypto look like they went 10 rounds with 1990s Mike Tyson.

Obviously, there's some "prisoner of the moment" stuff going on. Simply, "bad thing" happened and we extrapolate that "bad thing" from now until kingdom come. Different aspects of crypto likely have staying power and will be around a long time. This event will cause an adoption slowdown but likely won't paralyze the industry permanently.

Confidence builds slowly and leaves suddenly. The last few days have completely reset the timeline. It will be interesting to watch it all play out.

And lastly, the Cramer Curse remains undefeated.