CryptoCheck-

How Sam Bankman got Fried

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BINANCE:FTTBUSD   FTX Token / Binance USD
Hi Traders, Investors and Speculators πŸ“ˆπŸ“‰

Losing $22 Billion in one day is probably a record for the books. Let's take a closer look at the Sam Bankman-Fried story...

At 30, SBF is(was) the youngest billionaire in the US. In 5 years, he managed to start the fastest growing DEX (FTX), as well as Alameda Research. He is also well connected. VERY well connected, with political ties to big names such as actors including Tom Brady , Naomi Osaka and financial institutions including Coinbase Ventures and Binance Labs. So how is it then that he got burnt and lost it all overnight? Let's take a closer look at the intricacies.

First, let's take a closer look at just how big and interconnected FTX really was:

πŸ’° 44 Active investors deposit $1.8 Billion in just a year

πŸ’° Celeb Ambassadors including actors such as Stephen Curry, Tom Brady and Naomi Osaka
...hopefully we've learnt our lesson about trusting actors on crypto with Matt Damon on BTC and Ashton Kutcher with his XRP endorsement right before major crashes.... no?

πŸ’° FTX has a combined value of $40 Billion in 2022

πŸ’° FTX sponsors Mercedes in F1

πŸ’° FTX sponsors Major League Baseball, FTX printed on all shirts (guess who's getting a new wardrobe...)

πŸ’° Fortune Magazine Face - "Next Warren Buffet"

After the SEC forced shutdown in 2018 of crypto exchange broker 1Broker, many crypto moguls decided to take their companies elsewhere. This is also true for Sam, who decided to open FTX in Hong Kong later moving to Bahamas, away from the restrictions and regulations of the US. Binance followed a similar path, later moving it's company from China to Cayman Islands. SBF continues to keep favor with the US as he makes large contributions to Joe Biden's campaign, over $11 million. He reportedly spent over $47 million supporting democratic political campaigns. SBF networking progresses and he often testified to congress about how crypto regulations should proceed, even though he moves his business to the Bahamas (not the US). He positions himself as the voice of reasoning for the future of crypto regulations. During 2021, SBF reaches the peak of his wealth and fame. He nd 9 other youngsters are leading the FTX empire from the penthouse in the Bahamas.

Some say he became overconfident, others say he was sloppy. It seems as though the start of his downfall was due to Rival, CZ from Binance. Back in 2019, CZ hinted on Twitter that SBF was involved in an attempted attack on Binance futures platform. CZ later drives down the price of FTT by publicly stating their exit from FTX after "certain revelations came to light". SBF responds with a tweet "you won, well played".

When the bear market arrives late 2021, SBF is portrayed as a saint as he "invests hundreds of millions" in companies such as BlockFi, Voyager and Celcius whilst they face liquidity problems. A research report from September 2022, reveals a different story. He, infact, invest miniscule amounts or even nothing at all to help these companies! But this article does not make headlines, yet. Then a whistle blower breaks the news - Alameda Research uses $10 billion of customers FTX funds to make a risky investment, which is totally illegal. This is the complete opposite of the terms and conditions on his website as well as the opposite of what he said to Congress during his talks about how regulations should be. This is where the saying "not your keys, not your crytpo" shines. Crypto users and SBF fans are heart broken... How could he??

The final blow: Recently, continuous rivalry on crypto twitter between CZ and SBF fuels the price drops on FTT as CZ claims to sell all remaining tokens. Alameda Research (one of the 9) jumps in and claims to "buy back" whatever CZ has left to sell. But then, another stroke of bad luck - the balance sheets of Alameda Research leaks. As it turns out, they have NO liquidity, especially not enough to make any FTX buyback. And so, overnight, the price drops a whopping 89% and there goes most of SBF's wealth.

Final Thoughts...
If you're smart enough, have the right support structures and a great PR team, you can grow your fortune with fake virtue signaling. Infact, many philanthropes (unlike Jeff Bezos 's ex wife whom you probably don't even know about) will only donate when the camera's are on. They also ensure that they are highlighted as kind hearted saints by the media. They do whatever it takes to hide all the corruption and money laundering behind the scenes. SBF was portrayed as the humble, young billionaire face op crypto, and everyone wanted him in their corner due to his trading brilliance and profitable partnerships. Sometimes, however, when the bad deeds start outweighing the good ones exponentially, it becomes increasingly hard to hide the true events from the public .It has, somehow, come to light that instead of being a humble and charitable public servant, SBF was the leader of a group of kids living the highlife in a penthouse in the Bahamas. Misusing funds for corruption and illegal activities including but not limited to money laundering. And so came the fall of Sam Bankman Fried. His downfall involves deception, illegal activities, large political contributions and the misuse of customer funds. It is noteworthy that most of his wealth was in FTT , native crypto to FTX decentralized exchange (DEX) .


πŸ’­...This is no uncommon thing. Many people do the same illegal stuff, probably even on a larger scale but somehow, SBF got burnt. You can't help but wonder... Who Fried Sam Bankman ?



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Comment: CORRECTION : FTX is a CEX not a DEX, my apologies.

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