"4) FTX International currently has a total market value of assets/collateral higher than client deposits (moves with prices!). But that's different from liquid

"4) FTX International currently has a total market value of assets/collateral higher than client deposits (moves with prices!). But that's different from liquidity for delivery--as you can tell from the state of withdrawals. The liquidity varies widely, from very to very little. 5) The full story here is one I'm still fleshing out every detail of, but as a very high level, I fucked up twice. The first time, a poor internal labeling of bank-related accounts meant that I was substantially off on my sense of users' margin. I thought it was way lower. 6) My sense before: Leverage: 0x USD liquidity ready to deliver: 24x average daily withdrawals Actual: Leverage: 1.7x Liquidity: 0.8x Sunday's withdrawals. Because, of course, when it rains, it pours. We saw roughly $5b of withdrawals on Sunday--the largest by a huge margin." https://twitter.com/SBF_FTX/status/1590709172936798208 https://twitter.com/SBF_FTX/status/1590709172936798208 I don't understand this. In FTX International terms of service ( https://help.ftx.com/hc/article_attachments/9719619779348/FTX_Terms_of_Service.pdf https://help.ftx.com/hc/article_attachments/9719619779348/FT... ) they say that users have full title to digital assets, that they are the property of the user, and shall not be loaned to FTX trading and are treated as they belong to FTX trading, and that users control the assets in the account. FTX was never claiming to run a bank where they loan out users deposits for interest. They were claiming to be running a 100% allocated, straight up custodial vault. Therefore they should be able to simply return whatever assets customers owned on their service, even if every customer wants their asset back at the same time. If they were actually loaning out customer's assets and running a fractional-reserve bank, that is just straight up fraud, full-stop.