FTX CEO Gives Some Examples of Using Crypto Outside of Investing

Many see crypto as just a speculative investment tool, but according to FTX CEO Sam Bankman-Fried, digital assets can be used in a thousand and one ways. Here are some examples.

Instead of buying tokens in the hope that their prices will increase, Sam Bankman-Fried called his followers to focus on crypto’s potential uses in payments, market structure, and social networks.

Crypto Payments

With regard to payments, SBF pointed out that transaction dynamics have changed over time, mainly due to innovation and the development of new technologies.

According to him, payments are difficult, slow and expensive and traditional financial systems can take several days or months to validate certain transactions. A problem that he explains by the complexity of the processes of traditional institutions.

However, all of these problems can be eliminated with crypto, because “blockchains allow anyone to create a wallet and use it to send and receive tokens, including USD-backed stablecoins.”

The CEO of FTX clarified that crypto payments are processed in seconds and “often cost less than pennies”.

Using crypto in market structuring

According to Sam Bankman-Fried, traditional markets are at risk of being flooded with trades. He cited the example of January 28, 2021, when private investor interest in Gamestop, AMC and meme coins grew exponentially.

The presence of multiple intermediaries in the transaction process resulted in a high “settlement risk”, forcing these brokerage firms to suspend their services in order to manage the situation.

As a result, users were unable to buy or sell their assets, while some saw their positions liquidated or their money lost.

SBF believes that crypto helps address these market structure issues as it “can create a simpler, fairer and less risky market structure and settlement method.”

Social networks

The CEO of FTX believes that isolation is the biggest problem facing social networks.

In his tweet, he explained that users of one social media platform cannot see what their friends are posting on other platforms of the same type.

“Now if you tweet something and your friend is on Facebook, they won’t be able to see your tweet.”

Blockchain technology could change the situation by making platforms interoperable, SBF emphasized. According to him, if social networks adopt public blockchains, a user can send a message on Facebook and his friend can see the same message on Twitter.

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