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The Editors

FTX Offers a Master Class in Crypto’s Flaws

Sam Bankman-Fried’s spectacular flameout illustrates just about everything that’s wrong with crypto markets.

No, really, it isn’t.

No, really, it isn’t.

Photographer: Christopher Pike/Bloomberg

In one sense, investors and regulators should be grateful to Sam Bankman-Fried, the erstwhile head of the FTX cryptocurrency exchange. The spectacular flameout of his virtual empire has evolved from a cautionary tale into a master class on everything that’s wrong with crypto markets.

As customers and creditors sort through what remains of the failed exchange’s holdings, and as the repercussions spread throughout the crypto realm, here are four lessons that stand out: