In a new interview he claims he thought was off the record, SBF was either ‘venting’ or showing his true colors.
In a Twitter DM interview he claims he thought was off the record, the former crypto wunderkind and CEO of bankrupt FTX, FTX US and Alameda Research was either ‘venting’ or showing his true colors.
It’s hard to read former FTX CEO Sam Bankman-Fried’s today’s collection of Twitter threads and interviews and not come away from it with the sense that an attorney — civil or criminal — would be begging him to stop. In fact, FTX’s new CEO has had to make it quite clear that Bankman-Fried is no longer speaking on behalf of FTX.
It’s fair to say that stream-of-consciousness Twitter ramblings and off-the-cuff interviews are not a traditional legal strategy — especially when Bankman-Fried is saying he thought the company had $5 billion in leverage, rather than the $13 billion in reality. The media is reporting that the failure of SBF’s FTX crypto exchange and trading firm Alameda Research, and his part in it is being investigated by Department of Justice prosecutors, the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) as well as, according to FTX’s current leadership, “dozens of Federal, state and international regulatory agencies.” It has also been reported that SBF is going to be at least asked to speak at a House Financial Services Committee hearing next month.
On his own rambling Twitter thread, the one that started with a 26-hour-long spell-out of “What H A P P E N E D,” Bankman-Fried’s most relevant comment comes off as the tweet (No. 20) that said, “We got overconfident and careless.”
That particular tweet was prefaced with an explanation that comes off as one of his most honest, or at least the one most based in reality:
“I was on the cover of every magazine, and FTX was the darling of Silicon Valley.”
That was at 2:09 p.m. ET on Nov. 16.
I Feel Bad
At 3:20 p.m on Nov. 16., Vox published an interview based on a Twitter direct message conversation Bankman-Fried had the previous night with a reporter who’d interviewed him this summer.
At 5:55 p.m., Bankman-Fried was back on Twitter, complaining that in that conversation — with a reporter, who referred repeatedly to a previous interview he’d given her — he thought he was talking “to a friend of mine” who published messages that “were not intended to be public...” and that he was “venting.”
But in Vox’s Twitter DM interview, the comment that comes off as the most honest, or at least the one most based in reality is:
“hehe”
More specifically, after saying “yeah” to a question asking if comments he made over the last couple of year about “the ethics stuff [was] mostly a front,” Bankman-Fried was asked:
“[Y]ou were really good at talking about ethics, for someone who kind of saw it all as a game with winners and losers?”
He responded:
“Ya. Hehe. I had to be. It’s what reputations are made of, to some extent. I feel bad for those who get f***** by it. By this dumb game we woke westerners play where we say all the right shiboleths and so everyone likes us.”
Don’t Take That the Wrong Way…
There was much more in the Vox interview, notably responding to a question asking if his pre-collapse campaign for new and better crypto regulation was “pretty much just PR” by saying:
“Yeah, just PR. F*** regulators, they make everything worse. They don’t protect customers at all.”
He followed that up by saying consumer protection regulations aren’t really possible, in crypto or the rest of the financial industry.
Walking that back on the “What H A P P E N E D” thread, Bankman-Fried said:
“It's *really* hard to be a regulator. They have an impossible job: to regulate entire industries that grow faster than their mandate allows them to. And so often they end up mostly unable to police as well as they ideally would.”
He’d also told Vox that regulators “can’t actually distinguish between good and bad, just ‘do more business’ vs ‘do less business and ‘put up more moats’ vs ‘put up fewer moats.’”
Bankman-Fried later tweeted:
“Even so, there are regulators who have deeply impressed me with their knowledge and thoughtfulness… But most are overwhelmed.”
Saying that makes working inside regulatory structures “really frustrating” and a lot of work with “relatively little customer protection” to show for it, Bankman-Fried added:
“F*** that. You all deserve frameworks that let regulators protect customers while allowing freedom.”
Between the Vox interview’s publication and Bankman-Fried’s response to it, as mentioned above, new FTX CEO and corporate restructuring expert John Ray III tweeted out a statement:
“Mr. Bankman-Fried has no ongoing role at @FTX_Official, FTX US, or Alameda Research Ltd. and does not speak on their behalf.”
