Former FTX Executive Launches Trading Platform... Controversy Over "AI Investment Platform Built with Data from Customers' Losses"

▲ FTX

An individual involved in the past bankruptcy of a major virtual asset exchange has launched a new investment platform combining artificial intelligence (AI). However, the market's reaction is lukewarm.

According to cryptocurrency media BeInCrypto on May 19 (local time), Patrick Gruhn, former head of FTX Europe, launched UpsideOnly, an AI-based trading platform that purports a structure where users do not incur capital losses. This platform operates by having users submit simulated investment strategies for crude oil, gold, stocks, and virtual assets, and AI then selects ideas with a high probability of success. Subsequently, the parent company, Perpetuals.com, a Nasdaq-listed firm, executes the trades using its own capital. Users who provide investment strategies receive half of the generated profits and are not responsible for trading losses.

Gruhn emphasized the platform's structural strengths in a recent post. Gruhn explained, "People don't just interact with the market; they react," and "a significant portion of what is classified as risk stems from inadequate infrastructure." He added, "We approached the market as a system that can be designed and tested, thereby improving the flaws of existing structures." UpsideOnly's core engine, BayesShield AI, has learned from over 11 billion past trading data points. It has been confirmed that the core dataset consists of personal customer trading records from FTX Europe, which went bankrupt in 2022. Consequently, data from an exchange where numerous users lost funds has become the basis for a loss-free product.

Gruhn is still not free from accountability for the past FTX bankruptcy. He led FTX's European subsidiary until the parent company collapsed, and customer claims resulting from that bankruptcy amounted to billions of dollars. Gruhn has claimed that he was completely unaware of the fraudulent activities that occurred at the parent company. Currently, he is promoting UpsideOnly, presenting Perpetuals.com as a regulated alternative.

Market experts are questioning the platform's "zero risk" slogan. The condition of no losses only applies to users who submit simulated trades. All actual investment losses are directly absorbed by the listed company, Perpetuals.com. Currently, Perpetuals.com's market capitalization is only around $22 million, and it has been reporting consecutive losses. This is why critics argue that the company's financial buffer is woefully insufficient to support its marketing slogan.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*