“I didn’t thieve budget, and I undoubtedly didn’t stash billions away,” the disgraced cryptocurrency boss Sam Bankman-Fried claimed on Thursday in his first detailed reaction to the felony fees filed in opposition to him ultimate month.
In a observation titled FTX Pre-Mortem Evaluation and revealed on Substack, Bankman-Fried mentioned that thousands and thousands of shoppers of FTX, his bankrupt change, may just get their a refund and that “very considerable restoration stays probably to be had”.
Bankman-Fried has pleaded no longer accountable to felony fees that he defrauded traders and is lately on bail at his oldsters’ house in California on $250m bail.
“No budget had been stolen,” Bankman-Fried claims within the submit, providing a timeline of the change’s cave in that blames marketplace crashes and FTX’s largest rival, Binance, for the implosion.
US government have a unique view. Damian Williams, america legal professional for the southern district of New York, which is prosecuting Bankman-Fried, has known as the cave in “one of the vital largest monetary frauds in American historical past”.
In line with Williams and different US government Bankman-Fried and his colleagues siphoned off billions of greenbacks in buyer budget from FTX to spend on luxurious homes, different investments, political contributions and to prop up Alameda, a hedge fund additionally arrange via Bankman-Fried.
Within the submit Bankman-Fried argues Alameda misplaced cash as it used to be unprepared for the cave in within the cryptocurrency markets and emerging rates of interest. “And so Alameda’s belongings get hit, over and over and once more,” he wrote. “Alameda’s contagion unfold to FTX and different puts.”
FTX’s woes had been compounded via a “fateful tweet” via Binance’s leader government, Changpeng “CZ” Zhao, that initiated a run of FTX’s FTT token. Bankman-Fried paints the transfer as a “focused assault on belongings held via Alameda” that adopted “an especially efficient months-long PR marketing campaign in opposition to FTX”.
Given a couple of extra weeks, Bankman-Fried claims, the corporations can have weathered the typhoon. However, he argues, FTX used to be driven into an pointless chapter via legislation company Sullivan & Cromwell.
Bankman-Fried has said Sullivan & Cromwell recommended him to nominate veteran chapter specialist John Ray III to be the brand new CEO of FTX. Ray has argued that FTX collapsed as a result of an “unheard of and whole failure of company controls”.
Final November James Bromley, co-head of the restructuring apply at legislation company Sullivan & Cromwell, claimed a “considerable quantity” of FTX Workforce’s belongings “have both been stolen or are lacking” right through a court docket listening to.
Two of Bankman-Fried’s maximum senior colleagues, FTX co-founder Zixiao “Gary” Wang and previous Alameda CEO Caroline Ellison, have pleaded accountable to fraud fees and are cooperating with the government. Bankman-Fried does no longer point out them within the submit.
Bankman-Fried writes that he had was hoping to present his aspect of the tale at a congressional listening to that used to be scheduled for 13 December.
“Sadly, the DoJ [Department of Justice] moved to arrest me the evening earlier than, pre-empting my testimony with a wholly other information cycle,” he wrote.
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