Billionaire investor Bill Ackman showed his support of the cryptocurrency sector following the downfall of the FTX exchange, with the hedge fund boss outlining his crypto investment as a “hobbyist.”

"The telephone, the internet, and crypto share one thing in common. Each technology improves on the next in terms of its ability to facilitate fraud," Ackman said in a Tweet thread posted Sunday. "As such, I was initially a crypto skeptic, but after studying some of the more interesting crypto projects, I have come to believe that crypto can enable the formation of useful businesses and technologies that heretofore could not be created." 

The Pershing Square Holdings hedge fund founder shared his observations as the crypto market has been drowning thanks to the contagion fears stemming from the implosion of FTX. The world's once third-largest crypto exchange founded by Sam Bankman-Friend is seeking bankruptcy protection in the US and could leave up to 1 million creditors exposed to losses. 

FTX's native token FTT slumped earlier this month after rival exchange Binance said it would sell off its holding in FTT. The move followed a CoinDesk report that said much of the balance sheet in Bankman-Fried's crypto trading firm Alameda was made up of FTT. 

"The ability to issue a token to incentivize participants in a venture is a powerful lever in accessing a global workforce to advance a project. The problem with crypto is that unethical promoters can create tokens simply to facilitate pump and dump schemes," he said. 

Ackman told his more than 563,300 Twitter followers he's a "small direct investor" in crypto projects, including WiFi network Helium, bike-sharing company Limebike, and Switzerland-based Origyn Foundation.

He also said he's an investor in seven crypto venture capital funds and a small investor in companies.

"In total these investments represent less than 2% of my assets. I invest more as a hobbyist trying to learn than as a careful investor as I minimize the time I spend on non-Pershing Square investments so please don't rely on my due diligence or take any of the above as an investment recommendation," he said. 

"All of the above said, I think crypto is here to stay and with proper oversight and regulation, it has the potential to greatly benefit society and grow the global economy," he said. 

Ackman voiced his general support of crypto days after Binance CEO Changpeng Zhao said he was launching a fund for crypto projects needing liquidity in an effort to blunt the "cascading negative effects" of FTX's collapse.