Sam Bankman-Fried and the collapse of the FTX exchange. What does the crypto landscape look like after the crash?
Photo: Alex Wong/Getty Images
FTX was one of the most “credible” cryptocurrency exchanges, and its president, 30-year-old Sam Bankman-Fried, was even considered “the new Warren Buffett”. It’s already known to be wrong. The crypto industry is now afraid of “draconian” regulations, it has also been cut off from the financial drip. However, he does not lose hope.
Before his thirties, he financed congressmen, shone with the former president USA Bill Clinton and British Prime Minister Tony Blair. Sam Bankman-Fried promised to donate 99 percent of his money to charity. As a proponent of the “effective altruism” philosophy popular among tech billionaires, he said: “Ultimately, my goal is to maximize good and positive impact.
He turned out to be another cryptocurrency hustler, his exchange (valued at $ 32 billion) – a colossal financial pyramid, and the philosophy that guided him – a twisted truism that was supposed to make a good impression on the elites. In less than a week, Bankman-Fried’s private fortune is worth $16 billion. vanished into the air.
He ripped off big investors
The FTX exchange went bankrupt when it came to light that Bankman-Fried may have illegally used funds from customer deposits in his second company – Alameda Research, which conducts risky investments. FTX customers began to try to withdraw their money en masse and it turned out that the exchange only pretended that it had financial liquidity. US prosecutors are now investigating the founder of FTX for mismanagement of customer funds. Bankman-Fried, however, insists he “hasn’t tried to deceive anyone.”
The question, however, is why the president of FTX was trusted by Wall Street and the world’s premier financiers? He was given money not only by small players, who are always the biggest victims of fraud – “naive deer”, “pluckable plankton”, “capital donors” – but also by institutional investors such as BlackRock, the world’s largest company specializing in asset management, large pension funds or SoftBank, pumping billions into start-ups from Silicon Valley.
And Bankman-Fried ran a virtually shell company in the Bahamas, with no regulatory oversight and completely opaque finances. Employing a dozen or so twenty-year-olds with whom he lived like in a dormitory, that is, in a luxurious apartment-bunker worth $ 40 million.
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