Backpack Exchange, led by former FTX team members, prioritizes security and aims for a $100 million valuation, signaling a new era in crypto trading.
In the wake of the FTX collapse, a new player is emerging in the cryptocurrency exchange market, with a team that's all too familiar with the pitfalls of the industry. Former executives from the now-defunct FTX are joining forces to create a new exchange platform, Backpack Exchange, based in Dubai. This move comes 12 months after the dramatic downfall of FTX, which shook the crypto world to its core.
Backpack Exchange is not just another crypto exchange; it's a project born out of the lessons learned from the FTX fiasco. The team, led by Can Sun, a former FTX lawyer, is focusing on one of the most critical aspects that led to FTX's demise: the security of customer funds. To tackle this, Backpack Exchange is implementing self-custody solutions, which will employ a multiparty computation technique. This method is designed to ensure that users' funds are kept safe and secure, a significant selling point for the platform. The exchange is currently in its beta phase, with plans to open its digital doors to a broader audience later in the month.
At the helm of Backpack Exchange is Can Sun, who previously served as FTX's general counsel. Sun's experience is particularly noteworthy as he testified against Sam Bankman-Fried, the ex-CEO of FTX, providing insights into the mismanagement that led to the exchange's collapse. Joining Sun is Armani Ferrante, the CEO of Web3 digital wallet company Backpack, along with other former FTX staff. Together, they bring a wealth of experience and a keen understanding of the importance of transparency and security in the crypto exchange business.
Backpack Exchange is not just setting up a secure platform; it's also aiming high in terms of its financial goals. The exchange is looking to raise a 10% stake at a valuation of $100 million. This ambitious target reflects the confidence the team has in their business model and the demand for a more secure and reliable crypto trading platform. Moreover, Backpack has secured a license from the Dubai Virtual Assets Regulatory Authority, adding a layer of credibility and regulatory compliance to its operations.
The launch of Backpack Exchange serves as a reminder of the importance of security and proper fund management in the cryptocurrency industry. The platform's focus on self-custody solutions and the use of advanced security techniques like multiparty computation could set a new standard for exchanges. For users, the takeaway is clear: the security of their investments should be a top priority, and platforms like Backpack Exchange are working to make that a reality. As the exchange moves towards its wider launch, the crypto community will be watching closely to see if the lessons from FTX's collapse have truly been learned and implemented.