FTX Collapse: Bankman-Fried Breaks His Silence to Defend His Image

The disgraced crypto king was released on bail on Dec. 21. He will stand trial in October.

He wants to remain the master of his image. 

He wants to be able to control what is said about him even if that means breaking his silence as he faces a series of criminal and civil charges that could land him up to 115 years in prison.

The former cryptocurrency trader fails to follow the advice many lawyers often give to their celebrity clients: lay low.

Bankman-Fried wants to express himself and seizes the opportunity as soon as it arises to paint a positive image of him.

After a media tour at the end of November/beginning of December to tell his version of the fall of the FTX cryptocurrency exchange and its sister company Alameda Research, he has once again answered to harsh criticism of his actions.

‘I Obviously Disagree Strongly’

In an essay, Arthur Hayes, co-founder of cryptocurrency trading platform BitMEX, called Bankman-Fried a “fraud.”

“I’ll be exploring how the world’s perception of Pax America may start to shift after yet another pillar of Western financial exceptionalism, SBF/FTX — aided and unwittingly abetted by the Western financial and media establishment — robbing the rest of the world (ROW) blind,” Hayes wrote.

“I say the ROW because a majority of the impacted individuals and entities are neither American nor Western European. It was the Global East and South that were harmed the most by this fraud. And I will argue that the reason these countries let the fox in the hen house yet again was misplaced trust due to centuries of social conditioning, which has historically resulted in little ‘white’ soy-boys like SBF being given an automatic seat at the proverbial table, no questions asked.”

Bankman-Fried, known in the crypto space as SBF, did not appreciate this description.

“I obviously disagree strongly with many of the specific FTX-related claims here,” the former crypto emperor responded on Jan. 6. “But I largely agree with your higher level point. It’s a variant on something I heard again and again oversees.”

He added that: “I think you might be a bit surprised by my perspective on it.”

To what Hayes said: “ I’m listening. Please enlighten me…”

Bankman-Fried had still not responded at last check.

‘Why Are you Tweeting?’

Unsurprisingly, the comments to his post were largely negative, with many Twitter users asking him when he will to return FTX client funds.

“How are you going to give back everyone’s money that you stole? Probably should include interest as well,” commented actor producer Joel Heyman.

“This guy is headed to jail for life and still obsessed about what people think,” said another Twitter user. 

“Why are you tweeting,” one Twitter user said. 

The same day, Bankman-Fried intervened in a discussion about venture capitalists.

“Someone just tried to tell me that VC is “uncorrelated to the public markets”. I don’t think this person knows what correlation measures,” a Twitter user wrote on Jan. 6.

“Correlation of official marks of private companies can be 0 for a surprisingly long time though,” SBF commented. 

But the author of the post was not happy to have Bankman-Fried as a commentator.

“No I don’t know why SBF replied to my tweet about venture capitalists not understanding correlations, and I’ve muted that tweet… ” he said.

“Honestly there was no grand plan for the reply, I wouldn’t read too much into it (sorry, I guess you might have to mute this thread too…),” the disgraced CEO responded. 

The former crypto king had previously broken his silence to defend himself from a report stating that Alameda wallets became active days after he was released on bail.

“None of these are me. I’m not and couldn’t be moving any of those funds; I don’t have access to them anymore,” he said at the time. 

He added that: “I believe it is likely the case that various legit legs of FTX have the ability to access these funds; hopefully that’s what’s happening here. If not, hopefully one steps in soon to do so. I would be happy to help advise regulators on this if any wanted.

SBF pleaded not guilty on Jan. 3 to a series of criminal charges including allegations of fraud, filed against him by the Justice Department during a hearing in U.S. District Court in New York.

“Bankman-Fried was orchestrating a massive, yearslong fraud, diverting billions of dollars of the trading platform’s customer funds for his own personal benefit and to help grow his crypto empire,” the SEC alleges in its civil complaint.

The government has secured the cooperation of two SBF lieutenants: Zixiao (Gary) Wang, 29, FTX co-founder and former Chief Technology Officer, and Caroline Ellison, 28, the former CEO of Alameda Research.

They have both pled guilty to multiple federal fraud charges and agreed to cooperate with prosecutors.

Bankman-Fried was extradited to the United States on Dec. 21 by the authorities of the Bahamas, where he lived and where FTX is headquartered. 

He was released after his parents, both law professors at Stanford University, signed a $250 million recognizance bond pledging their California home as collateral. Two other friends with significant assets also signed, according to news reports.

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