Crypto 'White Knight' Sam Bankman-Fried (SBF), who was helping rival firms and companies overcome losses amid the ongoing market slump, has landed himself in hot water after some "not-so good decisions".
The crypto entrepreneur saw the fall of his empire â FTX and Alameda Research â this week, once worth more than $15 billion, it's now worthless.
Sam Bankman-Fried, known as SBF in the crypto circles, didn't sugar coat his words Tuesday morning when he told his employees, "I'm sorry. I fucked up." He had tried to pin the blame on Changpeng Zhao, his arch rival who was to become his saviour but walked away, whom he had accused of sabotage.
People close to SBF say FTX's fall was imminent as the seeds of its collapse had been sown months earlier when the 30-year-old billionaire had stepped up to save several crypto firms, and hefty donations to midterm elections Democrats candidates. Sources reveal that some deals involving SBF's trading firm Alameda Research led to a series of losses that eventually led to his fall.
FTX Established in 2019
Sam Bankman-Fried set up the FTX in Bahamas in 2019. FTX emerged as one of the largest cryptocurrency exchanges, accumulating nearly $17 billion. Investors valued FTX and its U.S operations, in early 2022, at a combined $40 million. Most of SBF's wealth was tied up in ownership of about half of FTX, and a share of its FTT tokens.
Reports have surfaced that the company was being run his inner circle. Sources said the "inner circle" is actually SBF's former co-workers from quantitative trading firm Jane Street and some he met at Massachusetts Institute of Technology. They are or used to be paired up in romantic relationships, including Caroline Ellison Alameda CEO.
Former FTX and Alameda Research employees described their workplaces as full of conflicts of interest, nepotism and lack of oversight. An employee even said that the "whole operation" was run by "a gang of kids in the Bahamas". Some workers believe SBF's inner circle knew that the company siphoned customer funds into the sister company Alameda Research.