FTX’s Collapse Reveals “False God of Profit” No. 1
Fortune called him “The Next Warren Buffett”…
Sam Bankman-Fried (SBF) was crypto’s boy wonder.
He founded the world’s second-largest cryptocurrency exchange — FTX.
But he didn’t just provide a place where people could buy and sell their favorite cryptos…
He spent a fortune on advertising, roping in everyone from Tom Brady to Larry David.
He even paid $135 million to sponsor FTX Arena, where the Miami Heat play basketball.
Millions believed this was the guy who’d lead crypto into the future.
But on November 8, it all came crashing down.
After rumors that FTX might be short cryptos, they suffered an old-fashioned run on the bank.
Within hours, the exchange ran out of money to pay for withdrawals, and SBF’s wealth was wiped out.
And sadly, $50 billion in customer funds went up in smoke.
All in the span of about 24 hours.
It was enough to shake the crypto world to its core.
FTX declared bankruptcy and it’s a snowball’s chance in hell if customers ever recover a nickel.
The CEO that replaced SBF took a look at FTX’s books and said it was worse than Enron.
The contagion from FTX is already spreading among the crypto world.
Who knows how many customers are going to lose all their money.
Yet I can’t say any of this surprises me, not in the least.
Truth About Crypto
If you’ve been reading for any amount of time, you’ll know I’m no fan of crypto.
In fact, I’ve had some pretty harsh words for it. (As you can see here…)
I never understood how electricity could produce a make-believe coin.
And people would trade them in hopes of making huge fortunes.
Cryptocurrencies are making the Holland tulip mania look respectable!
At least when the tulip mania collapsed in 1637, investors still had tulip bulbs.
When cryptocurrencies collapse, all that’s left is empty space.
I have a simple rule when it comes to investing my money…
If I can’t understand it, I can’t value it. And if I can’t value it, I don’t invest in it.
My view was often mocked by my colleagues.
They told me I was missing out big time and just wasn’t getting it.
But I totally got it.
Crypto has the false cloak of legitimacy combined with the fear of missing out.
That is a combination that causes huge losses to people that had no idea what they were getting into.
That’s why I told you — my readers — to stay away from it.
From the emails I received from many of you, I’m glad you took my advice.
Don’t Bet on a “Greater Fool”
If you only buy something in hopes of selling it for more money…
You’re not investing. You’re speculating.
You’re betting on finding a “greater fool” to make it work.
That’s what crypto is.
But when you focus on the business — one in an industry with a strong tailwind, run by a rock-star CEO and then buy shares when they are trading at a bargain price — then you’re investing.
So don’t be intimidated by fast-talking pitches about digital currency or how you’re missing the opportunity of a lifetime.
Instead, just focus on the facts and the analysis.
Because while bitcoin is down over 15% in the past month alone…
Some of my most recent stock recommendations are up 19% … 32% … and 33%.
Behind each one of these “M-Class Stocks” is an outstanding business that’s generating real value for the world.
So avoid the noise and hype.
Instead, partner up with great companies. Then let them make you rich.
And click here for the details on my M-Class Stocks now.
Founder, Real Talk