Sam Bankman-Fried, founder of crypto exchange FTX, comments on his billion dollar bankruptcy. The once 26-time billionaire says he has “maybe $100,000 left in the bank.”
The founder of the insolvent crypto exchange FTX, Sam Bankman-Fried, has defended himself against allegations of fraud after the spectacular collapse of his company empire. “I’ve never tried to cheat,” said the 30-year-old US entrepreneur at a conference in New York. Speaking from the Bahamas, where his trading platform for digital currencies like bitcoin was based, Bankman-Fried said, “I saw it as a thriving business and was shocked by what happened this month.” In hindsight, he’s ashamed. “We failed completely,” said Bankman-Fried, referring to the billions in losses at his crypto company.
FTX – one of the largest trading places for cryptocurrencies – collapsed about three weeks ago after enormous outflows of funds within a few days. Billions in customer funds could not be paid out. It emerged that Bankman-Fried had used funds from his FTX clients to prop up his crypto hedge fund, Alameda Research. He had dared to buy daring companies and needed a lot of money. The man, who is often just called SBF in the crypto industry, announced his resignation on November 11 and filed for bankruptcy for the group. Where the billions of customers have gone remains unclear even after his appearance on Wednesday.
“The US platform is completely solvent”
New FTX boss John Ray, who took the lead in the bankruptcy proceedings, slammed his predecessor, whose bankruptcy he is now managing: “Never in my career have I had such a complete failure of corporate control and such a lack of trustworthy financial information experienced.” Investigations and class action lawsuits against Bankman-Fried are ongoing in the United States. He asserted that FTX had enough money to pay out customers there. “The US platform is perfectly solvent,” he said.
When asked why he was still in the Bahamas and whether he still dared to go to the USA given the precarious legal situation, Bankman-Fried simply replied that he had already lived on the Caribbean island last year.
After graduating, Bankman-Fried first worked for a broker on Wall Street and in 2017 set up his own brokerage firm, Alameda. Two years later, with the money from cryptocurrency speculation, he founded FTX, whose business grew very quickly. In 2021, the trading volume made ten percent of the world market. In the same year, he landed on Forbes magazine’s list of the richest Americans with an estimated fortune of $26.5 billion. In Wednesday’s interview, Bankman-Fried said he had “almost nothing” left and only had a working credit card with “maybe $100,000 in the account.”
He is not concentrating on the allegations of fraud. “There will be a time and place for me to reflect on myself and my own future.”