Crypto.com CEO Says Exposure to FTX was Limited to $10M

Crypto.com CEO Kris Marszalek went online in an ask-me-anything (AMA) session on 14 November to quell customer concerns that the Singapore-based crypto exchange will be the next to face a liquidity crisis after the fall of FTX.

During the AMA session on YouTube, Marszalek assured users that the exchange had a strong balance sheet and a minimum exposure to the FTX exchange, which filed for bankruptcy last week. One of the main concerns of the crypto community that Marszalek addressed was that the exchange had sent over $1 billion worth of stablecoins to FTX in the past year, which was done to fulfill liquidity within customers’ orders when FTX was still functional. Marszalek said:

“Over a year, $1 billion was moved to FTX and we recovered all of this. We only had exposure of under $10 million when FTX shut down. FTX is a trading venue, where there is decent liquidity for some of the coins.”

Another major concerns was withdrawals, which Marszalek said will not be paused, but noted that a high volume of requests recently led to a backlog of customer service tickets. He also clarified that only three tokens had their withdrawal functions suspended — them being GALA, SRM, and Ray — two of which were FTX-connected tokens and the other a securitized token.

When asked if Crypto.com was using its native CRO token as collateral for loans, Marszalek claimed “we’ve never used it, and we haven’t needed to use it”. He pointed out that the exchange had a very simple business that “generates a fairly decent amount of revenue”, and that it has chose to focus in that direction.