Folkvang, a crypto market maker, lost a lot because it deposited half of its equity in FTX, but still plans to continue its operation
According to the news on February 24, Mike van Rossum, founder of the cryptocurrency market maker Folkvang, said in response to “the current situation of the company after the collapse of FTX”: “Our equity has been halved, so we have lost a lot of earnings in 2021. This is the risk, and we are glad that we can continue to operate.” Rossum disclosed that half of the company’s equity is linked to FTX, He said: “We can survive, but because we are very active borrowers, we have to pay back the loan at our own expense.”
Interpretation of this information:
The founder of cryptocurrency market maker Folkvang, Mike van Rossum, has revealed that the company has been impacted by the collapse of FTX. He explained that the company’s equity has been halved due to their links with FTX, resulting in significant loss of earnings in 2021. Despite this, Rossum remained optimistic, stating that although they are primarily borrowers, they can continue to operate despite now having to pay back the loan at their own expense.
This news highlights the potential risks associated with investing in cryptocurrency markets, which can be subject to sudden collapses and changes in market conditions. It also underscores the importance of diversification and risk management strategies to mitigate financial losses in the event of such situations.
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