We were all going to be using a form of cryptocurrency with all our transactions. It appears this will not be happening anytime soon. The crypto markets need to get past the fallout from recent events with FTX. This company was one of the world’s largest cryptocurrency exchanges that was valued at $32 billion and is now $0. It appears that in a few short days this company collapsed with no investors spared including major financial investment companies to celebrities and professional athletes. The founder and CEO, 30-year-old Sam Bankman-Fried company is now in bankruptcy, which may involve more than 100 companies and could affect more than a million creditors.

Mr. Bankman-Fried, was replaced as chief executive of FTX in November by John Jay Ray III, a veteran of corporate turnarounds including Enron’s bankruptcy proceedings. Mr. Ray wrote in a scathing court filing in the U.S. Bankruptcy Court for the District of Delaware that he had never encountered “such a complete failure of corporate control.”

The damage will not stop at FTX as the damage is spreading. Individuals and institutions are seeing their cryptocurrency being frozen due to a run on withdrawals. This week BlockFi, another cryptocurrency company with ties to FTX has filed bankruptcy and there may be more as this spreads in the crypto service community.

This is certainly a major setback for cryptocurrency as there may be significant regulation coming from this fallout. This does create opportunity to allow the Federal Reserve’s digital dollar program to take a step forward. This may all be part of the evolution of cryptocurrency. Much like the dot com bubble and bust, which later led to the massive growth in technology internet business. The crypto market may have to go through a similar progression. What will remain could be handful of successful cryptocurrencies and crypto financial services that provides a foundation for this to move forward to be more accessible for the general public.

Rich Flanery is a Certified Mortgage Planning Specialist and an Investment Adviser Representative. NMLS #256117. Branch location, 600 S. Saint Vrain Ave. #4, Estes Park, CO 80517. www.rockymountainlender.com.