From the FTX Collapse to the Rise of Backpacks — A Conversation with Armani Ferrante

Author: When Shift Happens; Edited by: Plain English Blockchain

In November 2022, FTX’s collapse was like an underwater bomb—instantly erasing years of credibility in the crypto industry and causing Armani Ferrante’s company balance sheet assets to evaporate overnight by 90%. Up in the cruising altitude of several miles, faced with a near-deadlock financial exam, this structural engineer deeply rooted in the Solana ecosystem didn’t choose to walk away. Instead, he completed an ideology-driven act of self-reflection about “who I am.”

In the disastrous embers, a backpack was quietly born. It isn’t only a global trading platform that broke through $420 billion in trading volume—it’s also Armani’s technical response to a “panopticon”-style modern surveillance regime. From the smooth route of Silicon Valley’s Apple headquarters to the market gamble of Tokyo’s “sleeping giant”; from simple code to the community faith behind the crazy young guys, Armani in this interview for the first time deeply revisits that infernal moment. This isn’t just a hardcore surviving-entrepreneur story—it’s also the ultimate prophecy about the 2026 wave of tokenization of global financial assets. When the reality you perceive becomes disconnected from the truth, do you choose to go along with the current, or do you rebuild the rules on top of the ruins? The answer lies in this in-depth conversation spanning the boundaries between philosophy and engineering.

A Defining Moment for Character: Surviving the Ashes of the FTX Collapse

Host: Let’s rewind the clock back to that turbulent moment. During the FTX collapse, the backpack was still a fresh, brand-new project, and you all were in serious danger amid disaster. I remember you mentioning that at the time, the company’s assets were all sitting in FTX accounts?

Armani Ferrante**:** That’s right. It was a digital amount that every founder would find compelling. At the time, we had $14.5 million in funds on FTX—about 90% of our company’s balance sheet assets. When I was on a flight from Lisbon, watching the reality slowly crumble as Crypto Twitter messages kept fueling one another over spotty Wi‑Fi. If the rumors were true—later it turned out reality was more brutal than the rumors—then my company was basically already dead.

In that mile-high cabin, surrounded by other peers who were also attending crypto conferences, the air was thick with anxiety. Without meaning to, I started existentially thinking. I asked myself the most fundamental question: Armani, what kind of person are you, exactly?

Are you the kind of person who gives up and laments fate’s unfairness when struck by a devastating blow beyond your control? Or are you the kind who, no matter how heavy the adversity ahead is, chooses to keep digging for life and fight it out to the end? Running a gas station on a street corner—when facing extreme circumstances—the essence of what you do is the same. In that moment, I realized this was a defining moment for character. I chose the night. When the plane made an emergency landing, I was already prepared to fight to the very last moment.

Host: That inclination is definitely moving. But ironically, you previously had two points of contact with Alameda Research (the company founded by SBF). Did this “close-range observation” lead to more complex feelings when you faced the collapse later?

Armani Ferrante: That’s indeed a wonderful turn of fate. In 2018, right after I left Apple, I was deeply captivated by Ethereum and the open-source allure of blockchain. Alameda was hiring people in Berkeley, needing engineers to build trading systems. I was there for three months—participating in early development—but I quickly realized that pure trading business wasn’t where my passion lay. I was more devoted to building base protocols and applications.

The second point of contact was in 2020. By then, FTX had accumulated momentum, and they invited me back to help drive the construction of the Solana ecosystem. I wasn’t working inside FTX; I was working on the infrastructure written for the Solana network—things like the developer framework Anchor for early development, multi-signature wallets, and so on. Solana’s wood was like a blank sheet of paper, full of engineering challenges.

I need to clarify something—this is also where I felt the most during the collapse: the huge gap between perceiving reality and actual reality. When Solana fell to $8, mainstream media and social platforms labeled it as an “FTX chain,” concluding that SBF died. But as someone who knew the truth on the ground, I understood that Solana’s codebase, the validator network, and FTX’s financial situation were two separate things. Strong nodes in a centralized network do exist. It’s a robust, anti-fragile system that won’t disappear just because one party’s collapse at a gathering.

Panopticon and Free Will: The Philosophical Undertone of Crypto Technology

Host: When talking about “who you are” and the company’s vision, you mentioned Michel Foucault and the concept of the panopticon. That’s a very deep entry point for a tech-background CEO. Can you talk more about how this philosophical metaphor influences your view of the crypto industry?

Armani Ferrante**:** The panopticon (panopticon) was originally a prison model designed by Jeremy Bentham: guards in the central tower can monitor all the cells arranged in a ring, while the prisoners loudly know whether they are being watched at this moment. This unjust monitoring leads prisoners to “self-monitor” and so on.

In the digital age, we’re actually living inside a panopticon in which the government is constantly expanding. Even big tech companies and even public ledgers record every transaction and every text message of ours. If you admit that privacy is a cornerstone of human beings and freedom, then much of the blockchain technology involved is actually misleading. Bitcoin and Ethereum’s public ledgers are completely transparent. In a sense, it’s easier to track a Bitcoin than to track cash.

Host: So do you think existing blockchain technology is not enough to protect freedom?

Armani Ferrante: Absolutely not. If a system exposes all of your financial history to the sun, it becomes a perfect surveillance tool. That’s why I have deep respect for privacy-preserving technologies (like the zero-knowledge proofs used by Zcash).

While building the backpack, we’ve been thinking: are we adding bricks to this panopticon, or are we using technology to provide individuals with low-cost tools to contest this kind of power? For ordinary people, they won’t generally see their bank balances. Our goal is to use crypto technology’s “atomicity” and “verifiability” to increase efficiency, while closely preserving individuals’ control over their data and assets within compliant frameworks. This isn’t just writing code—this is a redistribution of power.

Host: Does this obsession with “building what you want”—the “chip on your shoulder” you mentioned—become the spark that keeps people like you moving forward?

Armani Ferrante: Honestly, I’m not used to over-romanticizing my struggle history. If there’s any motivation at all, it’s love for “creation” itself. I’m an engineer. In the products I use, I see an idea turn from code into hundreds. The collapse of FTX did give me an opportunity to prove myself, but I’ve always believed that it’s not zero in a bank account—it’s whether you successfully have enough resources to pursue more interesting and more impactful experiments.

A lot of people postpone happiness in life, thinking that once they’ve earned enough money and reached some milestone, they can finally start living for real. But this “postponing your life” way of thinking is the root of suffering. Today you can choose the lifestyle you want, be with interesting people, and solve difficult problems. This kind of immediate satisfaction—in the process—is the most effective food to fight adversity.

The Tokenization Revolution in Finance: From “Hobbyist Crew” to Infrastructure

Host: You have a unique optimism about the current crypto industry, especially since market sentiment for 2026 isn’t exactly high. Do you think the financial sector is at a turning point?

Armani Ferrante: Yes. If the earlier crypto cycles were more about narratives, speculation, and the mania of meme coins, then now we’re entering the stage of “infrastructure moving from theory to reality.” Take a look at top institutions on Wall Street—people like Larry Fink talk a lot about AI, but privately they’re more bullish on the tokenization of assets.

Imagine the predicament of traditional finance: if you buy shares of an Apple company stock and settle it, it involves an extremely complex chain behind the scenes. From brokers to depositories, and then to central securities depositories (CSDs), each layer cross-checks everything. This leads to settlement delays of T+2 or even longer. On the blockchain, however, we can unify asset archiving, transaction logic, and fund settlement into one “atomic operation.” This process of compressing deep learning time into a global state machine can release massive capital efficiency.

Host: Is this the core problem the backpack wants to solve? Please explain your “unified margin account” product to regular users.

Armani Ferrante**:** Simply put, the current financial system is fragmented. You deposit money in a bank, buy stock with a broker, and buy coins on a crypto trading platform. If you want to use stock as collateral to borrow money, the process is indeed quite cumbersome.

The backpack’s “unified margin account” breaks down the walls between these asset classes. If you hold high-quality tokenized assets (whether tokenized treasuries, stocks, or crypto), you can directly borrow liquidity using them as collateral—without selling the assets and without triggering a taxable event. In the traditional world, this is a premium financial service that high-net-worth people (ultra-high-net-worth people) deserve to enjoy. What we do is democratize this service through smart contracts and real-time risk engines, so ordinary users around the world can access it.

Host: This sounds like the backpack becomes a global, regulated super financial application.

Armani Ferrante: That’s right. We’re not only building a trading platform—we’re rebuilding the structure of modern markets by using high-performance networks like Solana. Solana’s high TPS (transactions per second) isn’t just a technical metric. It means we can execute real-time risk management. In traditional finance, if the market collapses, it may take hours or even days to hedge and clear, triggering domino effects. On Solana, we can complete hedging and clearing at the millisecond level, greatly reducing systemic risk and thereby enabling higher leverage efficiency.

Strategic Shift and the Japanese Opportunity: Why Choose Tokyo?

Host: Since your target is global, why did you move your headquarters and main base of living to Tokyo? Three years ago, when you left California, many people didn’t think much of Japan’s crypto market.

Armani Ferrante: Choosing Tokyo was a carefully considered strategic bet. Japan has a special place in crypto history. As early as 2017, more than half of the world’s Bitcoin trading volume came from Japan. Even though due to early hacker incidents, regulation became extremely tight, precisely because of that, Japan has built a mature and transparent regulatory framework.

We believe Japan is a “sleeping giant.” As the Cambodian government clearly proposed making Web3 part of the national strategy, and with potential tax policy reforms (from 55% down to around 20%), the vitality of this market is being rekindled.

More importantly, the Japanese market has extremely high barriers. Because of the special requirements around language, culture, and compliance, U.S. licensing authorities (like Coinbase, Gemini) can’t easily land here directly. For teams like Backapack that are willing to go deep into the local area and respect regulation, this is a huge blue ocean. We’re not just looking for an office—we’re rooting ourselves here, growing together with Japan’s financial ecosystem.

Host: Speaking of regulation, you mentioned that FTX back then spent $800 million to buy licenses, while you got a similar set of licenses at a very small cost. Is there a secret to it?

Armani Ferrante: There’s no shortcut in regulation, but there is “a latecomer’s advantage.” Many older exchanges faced problems where they first operated unregulated business for a few years, and then were forced to pivot toward compliance. During that time, they accumulated a lot of “compliance accounting” and architectural patches. To clean up those historical issues, they had no choice but to give up compensating legal audits and costs.

The backpack designed the system to regulatory standards from day one. Our custody approach, risk engine, and anti-money-laundering (AML) procedures were built in parallel with the system architecture. In addition, we have a true cross-functional team that genuinely understands finance and law. When your system itself is transparent and audit-friendly, the communication costs with regulators drop dramatically. We’re not winning trust by technical strength alone.

The Power of Culture: The Link Between Mad Lads and the Community

Host: We have to talk about Mad Lads. As the founder of a trading platform, you created one of the most influential NFT series on Solana. Back then it looked like an unfocused side hobby, but now it seems like it became one of your core assets?

Armani Ferrante: That’s exactly what I want to emphasize: in the crypto world, “people” are always more important than technology.

For me, NFTs are essentially a piece of social text. No matter whether you’re in Tokyo, New York, or London, if you put a Mad Lad avatar on Twitter or speak up in Discord, you instantly find a group of people with shared values. Mad Lads represent a spirit of “never giving up”—a cultural symbol of the Solana community that keeps building even in the darkest times.

This new culture brings the backpack enormous loyalty. At several stages, what you need isn’t just users, but “momentum”—those who understand your vision and are willing to stay with you to iterate the product together. Mad Lads gave us this sense of identity. When we build products, we always know who we’re serving.

Host: This kind of transformation from culture into product is indeed extremely rare. At the end of this interview, what advice do you have for builders who are fighting in the 2026 market?

Armani Ferrante**:** Stay optimistic, stay curious. Most importantly: do the things that truly excite you.

The crypto industry is like a huge laboratory in an early stage. We’ll experience explosive growth, and we’ll also face catastrophic failures like FTX. But remember, the evolution of underlying technology doesn’t change according to personal will. These big trends—tokenization, decentralization, personal sovereignty—are irreversible.

2026 is still the best era for building. If you can choose, like us, to go forward even under the threat of your assets being reduced to zero on the custody balance sheet, then you’ll find that the most fascinating part of this industry isn’t the contour of a price curve—it’s the fact that we’re personally participating in creating the future’s global infrastructure. Don’t delay your life for the sake of some vague, meaningless milestone. Start building now, and start living now.

Host: Thank you, Armani. Your enthusiasm and your romantic view of engineering are highly contagious. Thank you for sustaining such firm confidence in us during this era full of variables.

Armani Ferrante: Thank you. The future belongs to builders.