After the crypto exchange company FTX went bankrupt, a user lost $2 million. The user informed the company to which Sam Bankman-Fried, the ex-CEO of the company apologized in an interview.
On Wednesday evening at the New York Times DealBook Summit, Sam Bankman-Fried, a controversial “Crypto King” was interviewed. One of his old buyers wrote in to insist on explanations.
Andrew Ross Sorkin, the journalist who was the host of the summit shared the email which had the subject line: “Sam Bankman-Fried stole $2 million from me”. It was from a man who said he had lost his life savings.
The user wrote: “Andrew, can you please ask SBF why he decided to steal my life savings and the $10 billion more from customers to give to his hedge fund, Alameda?”
“Please ask him if he thinks what happened was fraud.”
Sorkin had received several similar letters, he added, before asking Bankman-Fried: “What do you tell this man?”
“I am deeply sorry about what happened,” he replied.
The platform FTX US was still “fully funded” Bankman-Fried added and withdrawals “could be opened up today” he believed.
He then moved on to a long justification of Alameda’s scary trade situations, before condemning an “all-out PR assault, which led to a total market collapse in a pretty short period of time.”
The host then put forward the question of capital being mixed between Alameda and FTX.
The FTX lent Alameda $10 billion of customer funds for its high-risk bets, reported by The Wall Street Journal on November 11.
In the email, the FTX terms of service were also referred to by the customer which said: “None of the digital assets in your account are the property of, or shall or may be loaned to, FTX Trading.”
Bankman-Fried eventually said: “I didn’t knowingly commingle funds” when further questions were asked about the close ties between his companies by Sorkin.
The ex-CEO of FTX also believed that he is not “criminally liable” for FTX’s implosion later on in the DealBook interview.
The cryptocurrency exchange company did not have a department of accounting, the recent documents have shown. The expenses of the company were authorized by emojis on online discussions.
“It just kinda went crazy. If Sam said OK, it was good to go. Regardless of the amount” told The Financial Times one of the former employees.
What happened to FTX?
The FTX filed for Bankruptcy on November 11, 2022, due to mismanagement of their customer’s funds and lack of liquidity, a large volume of withdrawal requests from its investors surged the platform where the value of its own FTX’s native token and known cryptocurrencies including Ethereum, Bitcoin prices down and reached 2 years low as of Nov 9.
