From the collapse of Sam Bankman-Fried and Gary Wang’s FTX to the fall of Binance’s Changpeng Zhao, the cryptocurrency industry has witnessed some of the biggest pitfalls in the last couple of years, with several notable individuals losing millions if not billions of dollars worth in crypto.
The cryptocurrency market continues to be highly volatile, which is why investors must be able to grasp the fundamentals before judging the risks or getting caught up in the hype and fear of missing out on much decentralised finance (DeFi) projects.
The lack of a solid risk management strategy that would dictate to investors when the right time to exit a trade regardless of its outcome is another reason individuals could be prone to lose large sums of money while trading cryptocurrencies.
Among those taking substantial hits are several prominent billionaires, whose fortunes took a significant downturn amid widespread market turbulence.
Changpeng Zhao – $82 Billion
One of the most prominent names in the cryptocurrency industry, the former CEO of Binance Changpeng Zhao, allegedly lost around $82 billion during the crypto winter of 2022, data on Statista showed.
However, since then, the crypto billionaire’s net worth continued to decline, as he pleaded guilty to violating anti-money laundering requirements enforced by the U.S. Department of Justice in late November 2023 and paid a $4 billion settlement.
Despite the losses, Zhao is estimated to have a net worth of $33 billion as of April 2024.
Sam Bankman-Fried – $23 Billion
Sam Bankman-Fried, was the former co-founder of the doomed crypto exchange FTX, who lost about $23 billion, according to Statista, as the value of FTX and related assets collapsed.
Bankman-Fried’s losses can be attributed to high-risk strategies that led to significant financial losses.
However, Bankman-Fried had also faced allegations of fraud for his role in the collapse of FTX, including defrauding the exchange’s customers. His actions led to a significant loss of customer funds and investments, resulting in his arrest and a trial where he was found guilty.
On April 1, 2024, Bankman-Fried revealed that he was planning to appeal his 25-year sentence in an exclusive interview with ABC News.
Brian Armstrong – $4.7 Billion
Brian Armstrong, the co-founder and CEO of Coinbase, is another big name in the cryptocurrency space who lost a significant amount of money when the market plummeted in 2022.
Armstrong’s wealth was closely tied to Coinbase’s performance and the overall health of the crypto market. Therefore, when the crypto winter occurred in 2022, and the industry faced substantial losses, so did Armstrong’s net worth.
Still, even with the loss of $4.7 billion, estimated by Statista, Brian Armstrong’s net worth is $10.9 billion as of April 2024.
Gary Wang – $1.7 Billion
Gary Wang, the former co-founder and CTO of FTX, also faced a substantial loss of about $1.7 billion following the collapse of the FTX cryptocurrency exchange, according to Statista.
Most of his fortune was tied up in a 16 percent stake in FTX and a share of its FTT tokens. As of April 2024, Garry Wang dropped off all the Forbes ratings.
Chris Larsen – $1.3 Billion
Chris Larsen is known as a pioneering force in cryptocurrency, having co-founded Ripple, a digital payment protocol and currency exchange.
In 2022, he also faced a significant loss of $1.3 billion due to the downturn in the cryptocurrency market, according to Statista.
As of April 2024, Larsen’s net worth is $3.2 billion.
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