Goodwin.sol | (Ø,G) 💚

Crypto enthusiast | NFT collector | Airdrop hunter | DeFi explorer | Always in the game 🚀

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

How degen are you on-chain? Pull your @Housebets card, find out — and there's something in it for you. @HousebetsWhale drop my card. Use my code: PhantomPhoenix62 🃏

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

@Ponshood @ponsdotfamily https://t.co/GygtbnXorN Now is not working

[Solana @solana]

$SPCX is now live on Solana via @SunriseDeFi. issued by @Backpack Securities

[Alex Gleason @alexgleasonator]

Clawstr

[Alex Gleason @alexgleasonator]

It's already here https://t.co/awiJD5GoBx

[Backpack 🎒 @Backpack]

What's the ticker? 🎒

Wrong answers only.

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

Unfortunately we were made aware of a security vulnerability last night and have been forced to close access to our pools. The good news - all users that made bets were unaffected and we will be paying out bets in full. Until we have a fix, we will not be listing more pools.

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

MONAD BOXES 🎁

#Monad

[Armani Ferrante @armaniferrante]

Waking up to see this post, I'm a exhausted, disappointed, and heart broken to see it go viral and to see the responses.

No one cares about our users more than our team, and if you take the time to actually read our Discord and my tweets over the past day, I hope you'll see that. The team has spent the past 24 hours all hands on deck to make sure every single user story has been accounted for.

I don't have a crisis management team for this post. I honestly am shocked by it, given how much of a disconnect there is between how we actually feel, our actions, and the sentiment of the tweet. All I can do here is to give as much information as I can and to let the reader infer the truth.

As most of our long time users know, we often make mistakes, but we always do the right thing. This post appears to have taken a reply to a question out of context, where I'm explaining why something happened at a technical level. It doesn't mention our policy, our response, or what we're actually doing after yesterday's massive liquidation cascade.

The truth is that

- We paid out each and every trader *yesterday* immediately and automatically without issue. This has never been an issue.
- If you read our Discord announcements, you'll see that there has been zero clawbacks and zero socialized losses.
- We published our daily proof of reserves yesterday and the exchange has been operating uninterrupted since yesterday (although certainly with plenty of hiccups along the way)
- However, liquidity dropped off significantly when the market collapsed, causing a cascade of liquidations and ADLs on Backpack and every other exchange.
- As you can imagine, due to the massive liquidations, there are a lot of questions about what happened, e.g., what's auto deleveraging?
- This quoted screenshot and the associated tweet is completely taken out of context and doesn't communicate what is actually happening.

The screenshot, in truth, is a somewhat technical reply illustrating *how* futures profits and losses work. It is *not* a policy choice in response to any incident. It's explaining *why* something happened.

For those that don't have the context, here are the details:

- Firstly, Backpack is a completely neutral party. The exchange doesn't take on positions for users. We don't provide liquidity ourselves. The whole system works without reliance on any priviledged trader, vault, or any other party. In essence, it's infrastructure acting as a peer to peer match making service/exchange between longs and shorts, winners and loser.
- Every long has a short. This is a fundamental invariant of any perpetual futures system.
- When positions are closed, there is a settlement process, where profits and losses are exchanged between longs and shorts, winners and losers. Profits for perps are not printed out of thin air. It is not taken directly from our wallets either. Settlement is an intermediate step to realize the PnL.
- Winners on perps earn profits from losers. It's zero sum. That PnL is always conserved between the two parties on any given trade. Your counter party is the person on the other side of the exchange. When you profit on a perp, the losses are paid out directly from losers. If the losers run out of money, e.g., due to going bankrupt, then there's no money for the winners to realize their profits.

What happened yesterday, and what this quoted post is referring to, is that some of the losers went bankrupt and as a result their accounts were stuck in this "settlement" step. As a result, when those losing positions deposited into the exchange, the settlement process was able to automatically complete and the winners were automatically paid.

The issue: a small amount of these bankrupt users deposited into the exchange *before* we settled all accounts on the exchange on behalf of user. What the quoted post fails to mention is that we did this already, yesterday, before we published our daily proof of reserves, and we did this without question because it's simply the right thing to do.

Make no mistake: all positions have been settled without question across the board. We did not touch a single penny of unrealized PnL from our users and will never do so.

Going back to the topic of settlement mechanics. Settlement is not some horrible decision we made where we decided that we would take money from users after yesterday's event. It's a fundamental part of how the peer to peer system works: Loser pay winners directly. The exchange itself is not the counter party for a trade. The counter party is the person on the other side of the trade when you open a long or a short.

As a result, there's never a run on the bank risk. That's one of the many reasons why we are so comfortable publishing proof of reserves every single day, even on a historic liquidation day like yesterday. Even if the whole system were to blow up, the losses, contagion, and risk is isolated between all the longs/shorts, winners/losers. Anyone holding spot with no leverage is unaffected. This is a relatively technical point but it's an important one. We put an enormous amount of work into designing a system robust to these types of situations. Risk isn't an after thought, it's a core part of how the whole system is built.

To any user that deposited while their account was being settled--or to anyone that was unexpectedly affected for any reason--they should please email [email protected] and give us any and all information so that we can help. We are also present in Discord to answer questions. We do our absolute best to be available there all day every day, although in this case email is a lot easier for us to stay organized to move as quickly as possible.

In any case, I hope this clarifies the below quoted tweet, and what is actually happening. Honestly, we try to be some of the most approachable people we can. There's no question we don't answer. There's no PR crisis management team, here. We just do the right thing and hope that is good enough for the world.

We've put our heart and souls into our product, users, and community, and we will continue to do so.

Thank you for reading.

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

I just claimed my @CyberKongz $KONG airdrop.

I am now retired.

[Armani Ferrante @armaniferrante]

Story time.

Over two years ago we attempted Backpack's first fundraise for the exchange.

We had lost most of our money on FTX, and we had to re-invent ourself. With a couple small checks and our personal savings, we bootstrapped the initial exchange team to focus on all the hard things regulated companies have to do--not just engineering, but finance, accounting, compliance, customer support, and importantly, the entire licensing process for our first anchor license in Dubai.

From the beginning, it was never just about building a matching engine, it was never just about building an app, it was about being able to re-imagine every layer of the stack of modern finance, where the legal code is just as important as the computer code--a thesis at odds with basically every crypto investor in the world. We had our sites set not just on the UAE but on the entire world, and one place in particular, the European Union.

From the perspective of many international exchanges, to put it in their own words, a "bloodbath" was coming. The world's largest derivatives platforms were leaving the EU, and it was getting harder and harder to enter the market. At the time, there was a total of zero exchanges offering a regulated perpetual futures product.

So we went out to fundraise. Our goal was simple: get enough money to buy FTX EU, do all the hard work to return customer assets, hire up a world class compliance team, solve all the problems that caused FTX in the first place, and re-activate the license. Turns out fundraising wasn't that simple.

The world was in a very different place back then. Most people looked at us like we were crazy. A lot of people questioned me and our team for FTX ties. Who wants to invest in ex FTX and Alameda employees trying to buy back the EU arm of FTX, returning customer funds, and gunning to be the first regulated perpetual futures product in Europe. To many it was the most contrarian of bets and a far fetched dream. Why couldn't Coinbase or any of the other giants just beat you and do this first? A fair question. And honestly, I didn't have an answer to that. All I can say is that I genuinely think our team is the best. No one works harder. Works more hours. Has more experience, more ore battle scars, and a more comprehensive of an understanding of crypto exchanges than us. Others might have more resources. Others might have better brands. Others might have been around for longer than us. They deserve all the respect in the world for pioneering much our industry. However, it's my job to think I can do better. It's my job to compete. It's my job to win. I naively thought I could. Investors did not. We failed.

So we didn't buy FTX EU. It ended up being purchased by the previous founders. We missed the opportunity. But we didn't stop. Tunnel visioned. Laser focused. We built our product. We went to market. And, turns out, we were pretty successful. In 2024, we made more money than our entire fundraise. We built our spot product, and with the capital on hand, we were ready to re-invest to climb our next mountain.

I don't know if it was luck, divine intervention, or just the universe just doing its thing, but we discovered that FTX EU was for sale--again. This time, we didn't have to fundraise to make an offer. We had the cash ready to deploy. And so we did.

But the interesting thing about buying regulated companies is that it's not simply a matter of having cash. There's many more people with much more money than us. It's not just about showing up to someone's door with a bag of cash, and you're off to the races. There's diligence. There's compliance tech. There's reporting requirements. There's the ability to steward the return of FTX EU customer assets. There's custody requirements. There's controls. There's bespoke integrations. There's product changes. There's a million little details that go into getting a regulated company off the ground. Details that very few startups at our stage ever have to think about.

Some people think we're making our lives harder than they have to be by doing all of this. But it's precisely the hard things that no one wants to do that are worth doing.

And I'm proud to say that we did it, joining the ranks of only a handful of crypto companies in the world that have met the highest standards of compliance to offer a regulated product in one of the largest, most important, and most rigorous regions in the world. And for perpetual futures, specifically, one of the first.

It turns out you can just do things, and we're not stopping there.

This year, we set our sites not just on Europe, but later to Japan, and ultimately our home, the USA. We've come a long way, but we have an even longer way to go. Every day. Little by little. Brick by brick.

🧱

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

Registering my madlads.sol subdomain on @solana using @sns at https://t.co/NzxSfhnJpY

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

@tradeparadex @Crypto_Side_Off @Denys_key9N @Oleg_kelt007 @moldovaccine @Bogdan96720756 @0xcchan @0xRobinKH @DimaTryhub @AndrejM5954 @matatomik @Jeh07337578 @bugachapa @0xduca @vlad96035705 @yakinikudrink @mallikharjunsi5 @DimaNour4 @Sandy66531159 🫡

[Richard Wu @0xrwu]

TMF. Tensor Market Fit.

We're going to really nail it this time.

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

https://t.co/yWdHzJo7H4

[OpenSea @opensea]

OpenSea has evolved.

Beta complete. Full token universe unlocked.

New rewards program live. Welcome to the new OpenSea — the best place to discover, own, and trade anything onchain.

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

@_ilmoi

[ilmoi @ilmoi]

cooking

[Goodwin.sol | (Ø,G) 💚 @Goodwin008sol]

@tensor_hq Tnsr szn pls

[Velvet | Social Trading Terminal @Velvet_Capital]

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