Crypto billionaires see their fortunes shredded in weeks
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NEW YORK • Coinbase Global founder Brian Armstrong had a personal fortune of US$13.7 billion (S$19 billion) as recently as November and about US$8 billion at the end of March. It is now just US$2.3 billion, according to the Bloomberg Billionaires Index, after a sell-off in digital currencies from Bitcoin to Ether triggered a precipitous decline in the market value of Coinbase, the largest United States cryptocurrency exchange.
The firm's shares have tumbled nearly 86 per cent since their initial public offering in April last year till Wednesday, after the company warned that trading volume and monthly transacting users were expected to be lower in the second quarter than in the first.
It has raised questions about Coinbase's ability to withstand the sharp decline in crypto prices.
Mr Michael Novogratz, chief executive officer of crypto merchant bank Galaxy Digital, has seen his fortune plummet to US$2.9 billion, from US$8.5 billion in early November. He has been a champion of TerraUSD, the algorithmic stablecoin that is now at risk of a complete collapse amid a breakdown in the price of a crypto token in the same ecosystem, Luna.
Billionaire crypto fortunes that swelled over the last two years are disappearing after a sell-off that began with tech stocks spilled over into digital money. Bitcoin and Ether have both fallen more than 50 per cent since their record highs late last year.
Some of the biggest and most visible losses are concentrated among founders of exchanges, where traders buy and sell digital currencies.
Mr Zhao Changpeng, the CEO of Binance, debuted on the Bloomberg wealth index in January with a net worth of US$96 billion. By Wednesday, that had shrunk to US$16 billion.
Crypto entrepreneurs and brothers Tyler and Cameron Winklevoss, co-founders of crypto exchange Gemini, have each lost about US$2.1 billion - or roughly 40 per cent - of their wealth this year. The fortune of Mr Sam Bankman-Fried, CEO of crypto exchange FTX, has fallen by half since the end of March to about US$13 billion.
BLOOMBERG
