“The key takeaway is that illiquid tokens should not be used as collateral for loans, especially if the token was issued by the same party taking out the loan,” Przelozny says.
Several industry players are hoping that the contagion of the most recent FTX fallout is limited, with optimism that the incident will serve as a wake-up call calling for greater regulatory scrutiny in the space.
Adrian Przelozny, CEO and co-founder of Australian crypto exchange Independent Reserve does acknowledge that the short-term impact of the event will invariably see increased volatility in the crypto space, and downward pressure on asset prices as the uncertainty of which market participants have exposure filters its way through the market.
