Considering that "pretend money" is purchased with "real money", this distinction doesn't matter much. I guess it just depends on if you consider property valuable despite not having a green tint and dead political figure on it.

The question being asked is if the pretend money has risen in value subsequent to purchase, then is the amount lost the real money used to purchase it, or the pretend money at peak (or another) valuation.

With both the 16 billion figure being preceded by the U.S dollar sign, and FTX being an exchange for many different cryptocurrencies at drastically different values, they were probably adding up the dollars invested by stockholders and the dollars input into the website. After all, their FTT coin crashed and burned completely, and many other currencies are also dipping to record lows. If they valued the dollar based on current prices, then it would be multiples of $16B instead.

Either way, the inclusion of "astronomically overvalued cryptocurrency" as a descriptor definitely makes it seem more like a slight towards crypto than an honest question of the valuation. Put simply, a lot of people lost a lot of money.