A cadre of former FTX executives has united to spearhead the creation of a new cryptocurrency exchange based in Dubai, with a specific emphasis on rectifying the shortcomings that led to the insecurity of customer funds at FTX.
Leading this endeavour is Can Sun, the former legal representative of FTX, at the helm of Trek Labs, a startup based in Dubai that secured a cryptocurrency services license for the region in late October.
Operating under the name Backpack Exchange, Trek Labs is set to redefine the landscape of cryptocurrency services.
Supporting Can Sun is Armani Ferrante, another former FTX employee, who now serves as the CEO of Trek’s holding company in the British Virgin Islands.
Armani is also at the forefront of Backpack, a cryptocurrency wallet integrated into the operations of Backpack Exchange.
Can Sun’s legal deputy at FTX, Claire Zhang, who coincidentally is Armani’s spouse, plays a pivotal role in Trek’s executive team.
However, with plans to step back from the company once an investment round is successfully raised, Claire has been instrumental in the initial stages, working without pay to bootstrap the exchange.
Can Sun and Armani are steadfast in their commitment to applying the lessons gleaned from FTX’s shortcomings, particularly in safeguarding customer funds.
Can Sun stated:
“In a post-FTX world, you need trust and transparency to create a true alternative to the other players.”
Backpack’s technological architecture introduces a self-custody solution, incorporating a multiparty computation (MPC) technique to fortify fund security.
This approach involves multiple parties validating a transaction before funds are transferred, providing Backpack customers with the ability to verify their funds at their discretion.
Although Backpack Exchange is currently in beta testing, a comprehensive launch is slated for later this month.
In a bold move, the venture is seeking to sell a 10% stake to investors at a valuation exceeding $100 million.
Their strategic hiring of other former FTX legal and compliance professionals at Trek underscores their commitment to assembling a team with proven skills and experience.
Can Sun, who played a pivotal role as a witness in Sam Bankman-Fried’s (SBF) recent fraud trial, revealed that he distanced himself from FTX upon discovering SBF’s dubious actions.
He refused to be complicit in covering up these activities and, subsequently, cooperated with federal prosecutors by providing crucial evidence against SBF, leading to his conviction on all seven fraud-related charges.
His departure from FTX transpired the day after learning about the misuse of customer funds by SBF.
As Backpack Exchange enters the market, the response from investors and users remains a question mark, given the founders’ history.