Finance
FTX Files for Bankruptcy as Crypto King Plays League of Legends
Millions of his investors were left scratching their heads as cryptocurrency exchange FTX files for bankruptcy
SANDY HOSIER: Cryptocurrency exchange FTX has filed for bankruptcy, as founder Sam Bankman-Fried was forced to step down as chief executive, or whatever it was that he did. Millions of his investors were left scratching their heads, including money-making experts Tom Brady, Steph Curry, Naomi Osaka and Shaquille O’Neal, sports people whose endorsement of Bankman-Fried’s helped propel the 30-year-old to the status of financial genius. Now, they find themselves potentially complicit in one of the largest ponzi-schemes in recent memory. James Plushfoot reports on the rise and fall of the former MIT maths and physics student, who dropped out of college to become a master of persuasion and video games.
JAMES PLUSHFOOT: Once compared to investment legend Warren Buffett, FTX founder and CEO Sam Bankman-Fried is now being compared with disgraced fraudster Bernie Madoff, having potentially robbed 100’s of thousands of people of their investment in the what was the world’s second largest crypto-currency exchange. Today, Bankman-Fried watches on as his FTX empire and $US15bil fortune collapse, telling investors on Twitter he was, quote ‘shocked and sorry’. Like Madoff before him, Bankman-Fried was respected INNformation by celebrities and wall-street bankers for no particular reason. His laid back style and self-admitted addiction to the video game League of Legends, was written off as a quirk of a young, eccentric genius. failing to ring any alarm bells for investors even as he played the game during high-stakes online business meetings. Cody Bootliner invested over half of his savings with Bankman-Fried, but never suspected there was anything to worry about.
CODY BOOTLINER: I knew he was a League of Legends wizard because I’d played with him. All you’d hear is click, click, click and I’m thinking, wow what a player! But when I started hearing the same noise in our investment meetings, I honestly thought… Wow, what an investor! To be able to juggle multi-million dollar transactions while in a multiplayer battle arena? I mean, he’s not just a crypto-king. He’s an inspiration and a genius, and I’ll keep investing my parents money in whatever he does ‘cause I’m a crypto guy man – to the Moon!
PLUSHFOOT: Others were not as buoyant about the collapse of FTX. INN go-fer The Drudge is one of thousands waiting to hear whether he’ll ever be able to access his money again…
THE DRUDGE: (Subtitles) It was Giselle Bundchen’s endorsement that got me mate – She’s just gorgeous and if you’re gonna invest in crypto and you’re choosing between her and bloody Matt Damon, it’s a pretty easy call. Now I’m losing almost as much as her ex-husband Tom Brady, and I don’t get the perks of being married to her! It’s just horrible.
PLUSHFOOT: FTX will now be under investigation by the FBI and financial authorities, major investment firms such as Blackrock and Softbank looking for answers as to how the 30-year old dropout was able to CEO the company. The answers may lie with Bankman-Fried’s parents Joseph Bankman and Barbara Fried, professors at Stanford University who were confirmed to have accepted cash payments by FTX for legal advice and other involvement in the doomed platform. Good one Dad.
SANDY: Thanks James. It is estimated that FTX acquired up to $50bn in assets and liabilities from around 100,000 creditors. Amazing that so many were people were taken in. You weren’t involved were you Brian?
BRIAN: No, I don’t know anything about Crypto, but I don’t mind checking the SOCK market every now and then!
SANDY: ARGH!
