Backpack Lost 90% of Its Capital in FTX Collapse
Backpack founder and CEO Armani Ferrante said the company had about 88% to 90% of its operating capital—roughly $14.5 million—held on FTX when the exchange collapsed in November 2022. FTX Ventures had co-led Backpack’s $20 million funding round just weeks earlier.
Backpack survived, relaunched and later raised $17 million in a Series A. In January 2025, it acquired FTX Europe for $32.7 million, gaining a MiFID II license and taking responsibility for claims involving about 110,000 European customers. Backpack says it now emphasizes regulation, user control and independent balance verification, positioning those safeguards as lessons from FTX’s failure. The company has also reported more than $420 billion in cumulative trading volume and over 420,000 verified users.
Neutral
The news is primarily a retrospective on Backpack’s exposure to FTX and its subsequent recovery, rather than a new market-moving event. The reported $14.5 million loss and concentration of 88% to 90% of operating capital on one exchange underline counterparty and custody risks, but the article does not report a new loss, disruption or change to crypto-market liquidity. The story is therefore unlikely to move major token prices directly, supporting a neutral market view.
In the short term, traders may revisit exchange solvency, proof-of-reserves and custody diversification, themes that drew attention after FTX failed in 2022. Such concerns can influence sentiment toward centralized exchanges, but this account alone is unlikely to trigger broad selling. Long term, Backpack’s acquisition of FTX Europe, MiFID II license and emphasis on balance verification may support its business credibility and highlight the value of regulation and transparent custody. Those developments are company-specific; any effect on SOL or the wider market is likely to be limited unless accompanied by measurable changes in user activity, trading volumes or capital flows.