FTX co-founder and former CEO Sam Bankman- Fried, once a beloved leader in the sector of criptocurrencies, is now being labeled a criminal.
The disgraced entrepreneur is currently on a media tour to discuss how the exchange he founded went into disarray, but seems to be having a hard time answering pointed questions, as evidenced by a recent interview with George Stephanopoulos for Good Morning America. What happened to Bankman-Fried, who is a Bernie Madoff-like figure, Stephanopoulos said.
I don't think that is who I am at all, but I understand why they say that. Bankman- Fried said that people lost money. There was no business with Madoff, and it was a Ponzi scheme. He argued that FTX was a real business.
Bankman-Fried skirted a number of questions and struggled to find answers to others, including whether he was aware of FTX customer deposits being used to fund Alameda Research. Caroline Ellison, the CEO of Bankman-Fried, said that Alameda had an over-collateralized position that was threatened.
Bankman- Fried repeated the question back to himself before answering.
He said he could not speak for who knew what FTX deposits were being used to pay off Alameda creditors. Stephanopoulos, reading from the FTX terms of service, said FTX assets couldn't be loaned. Bankman- Fried says funds could be loaned out in some explicit cases, and there does exist a borrow lending facility on FTX. Stephanopoulos asked why Alameda borrowed money without user approval wasn't setting off alarm bells in Bankman- Fried's head.
There were a lot of people involved in that process, Bankman-Fried said, while also admitting that he was ultimately responsible. I wasn't spending any time and effort trying to manage risk on FTX. When asked what Bankman- Fried would say in court and under oath if Ellison claimed Bankman-Fried knew about the borrowing activity, Bankman-Fried said: I did not know there was any improper use of customer funds. Why It is Important: The interview aired Thursday on ABC, a unit of The Walt Disney Company DIS. This was a national network interview for Bankman- Fried and a chance for him to answer questions.
The legacy of Bankman- Fried has been hurt and the founder of FTX doesn't know where that will put him in the future.
Bankman- Fried said when asked about Mark Cuban's saying he should be in jail that he should not be my call and that the world will judge me as it will.
Bankman- Fried brushed off the question and said he would let the regulatory and legal processes play out.
He said there are a lot of things that are worrying me right now and he is trying to focus on what I can do going forward to be helpful.
Bankman- Fried said he spent a lot less time looking at deposits and holdings than he should have. It could have prevented FTX from collapsing if he spent an hour a day on this, according to Stephanopoulos.
The head of a firm like that is responsible for risk, Stephanopoulos said.
Bankman-Fried reached out to ABC and spoke with the network for two hours, which may have gone against what his lawyers thought was best, Stephanopoulos said.