www.bbc.com Open in urlscan Pro
151.101.64.81  Public Scan

Form analysis
0 forms found in the DOM

Text Content

LET US KNOW YOU AGREE TO COOKIES

We use cookies to give you the best online experience. Please let us know if you
agree to all of these cookies.

Yes, I agree

No, take me to settings

BBC Homepage
 * Skip to content
 * Accessibility Help

 * Sign in


 * Home
 * News
 * Sport
 * Reel
 * Worklife
 * Travel
 * Future
 * More menu

More menu
Search BBC
 * Home
 * News
 * Sport
 * Reel
 * Worklife
 * Travel
 * Future
 * Culture
 * Music
 * TV
 * Weather
 * Sounds

Close menu
BBC News
Menu
 * Home
 * War in Ukraine
 * Coronavirus
 * Climate
 * Video
 * World
 * UK
 * Business
 * Tech
 * Science
 * Stories

More
 * Entertainment & Arts
 * Health
 * World News TV
 * In Pictures
 * Reality Check
 * Newsbeat
 * Long Reads

 * Tech


THE FALL OF THE FTX ‘KING OF CRYPTO’ SAM BANKMAN-FRIED

Published
17 hours ago

Share
close
Share page
Copy link
About sharing
Image source, Getty Images
Image caption,
FTX founder Sam Bankman-Fried stepped down as chief executive on Friday
By Joe Tidy
Cyber reporter


It took fewer than eight days for Sam Bankman-Fried to go from being nicknamed
the "King Of Crypto" to his company filing for bankruptcy and him stepping down
as chief executive, facing federal investigations into how he handled the
company's finances.

Over the last few years, the internet has been flooded with long interviews with
him, speaking over video chat from his office desk in the Bahamas.

In some of them, there's a distracting clicking noise.

As his interviewees listen intently to his incredible story of how he became a
multibillionaire in five years, the sound is persistent and clearly coming from
the American entrepreneur's mouse.

"Click, click, click," it goes, in rapid, on-off bursts.

Meanwhile, Mr Bankman-Fried's eyes dart around the screen.



It's not clear from the videos what he's doing on his computer, but his tweets
can give us a pretty good clue.

"I'm (in)famous for playing League of Legends while on phone calls," he tweeted
in February 2021.

Mr Bankman-Fried - the former boss of embattled cryptocurrency exchange FTX - is
an avid gamer. And in a series of tweets to his nearly one million followers, he
explained why. Playing the team fantasy battle game was his way to get his mind
to switch off from running two companies trading billions of dollars a day.

"Some people drink too much; some gamble. I play League," he said.

Image source, FTX
Image caption,
Sam Bankman-Fried also enjoyed playing a video game called Storybook Brawl so
much he brought its maker in March 2022

Since the 30-year-old's cryptocurrency empire collapsed this week in dramatic
fashion, another anecdote about his gaming has resurfaced online.

According to a blog post from venture capital giant Sequoia Capital, Mr
Bankman-Fried played an intense League of Legends battle during a high-level
video call with their investment team.



It didn't seem to put off them off at all, though. The group proceeded to invest
$210m in Mr Bankman-Fried's company FTX.

This week, Sequoia Capital deleted that gushing blog post and announced it is
now writing off their FTX investment as a loss.

The firm is not the only investor to have lost eye-watering amounts of money
since Mr Bankman-Fried's $32bn empire collapsed.

FTX had an estimated 1.2 million registered users who were using the exchange to
buy cryptocurrency tokens such as Bitcoin and thousands of others.

From large traders to everyday crypto fans, many are left wondering if they will
ever get back their savings trapped in FTX's digital wallets.

 * Crypto giant FTX collapses into bankruptcy
 * 'I'm waiting to get £2,000 back from crypto giant'

It's a dizzying downfall and the rise of Mr Bankman-Fried is also its own
dramatic story of risks, rewards and beanbags.



Mr Bankman-Fried went to Massachusetts Institute of Technology (MIT) - a
prestigious US research university where he studied physics and maths.

But the young bright undergraduate says it was lessons learned in the student
dorms that led him on his path to getting rich.

In a BBC radio interview last month, he recalled being swept up in the
"effective altruism" movement. Effective altruism is a community of people
"trying to figure out what practical things you can do with your life to have as
much positive impact as you can on the world", he said.

So, as Mr Bankman-Fried recalls, he decided to get into banking to make as much
money as he could to give it back to good causes.

He learned to trade stocks during a short stint at trading firm Jane Street in
New York before he got bored and decided to experiment with Bitcoin.

He noticed the variations in the value of Bitcoin across different
cryptocurrency exchanges and started arbitraging - buying Bitcoin from places
selling it cheap and selling to other places where it was trading for more.

This video can not be played


TO PLAY THIS VIDEO YOU NEED TO ENABLE JAVASCRIPT IN YOUR BROWSER.

Media caption,

Are crypto-currencies the future of money?

After a month of making modest profits, he got together with some college
friends and started a trading business called Alameda Research.

Mr Bankman-Fried says it wasn't easy and took months of perfecting techniques
about how to move money in and out of banks and across borders. But after around
three months, he and his small team hit the jackpot.

"We were super-dogged," he said to the Jax Jones and Martin Warner Show podcast
a year ago. "We just kept going. If someone throws another roadblock, we would
be creative, and if our system couldn't handle that, we would just build a new
system to get us through that hoop."

By January 2018, his team were making $1m every day.

A business reporter at CNBC asked him recently how that felt.

Intellectually and according to his methodology, he said, "it made perfect"
sense. "But viscerally, it surprised me every day," he said.

Sam Bankman-Fried became an official billionaire in 2021, thanks to his
secondary and more high-profile business - FTX. The crypto exchange grew to be
the second largest in the world and a titan of the industry, seeing $10-$15bn
traded a day.

Image source, Twitter
Image caption,
"Mostly I sleep on a beanbag," Mr Bankman-Fried told his Twitter followers

In early 2022, FTX was valued at $32bn and a household name, with an NBA stadium
named after the company and endorsements from celebrity backers such as the
NFL's Tom Brady.

All the while, Mr Bankman-Fried seemingly delighted in giving his Twitter
followers an insight into his lifestyle. He mainly sleeps on a bean bag next to
his desk in the office, he said, with a picture of him lying next to his staff
at their trading terminals.

In another, he posted in the early hours of the morning. "Couldn't sleep. Back
to the office," he wrote.

Mr Bankman-Fried's dream of giving away vast amounts of money to charity was
also well under way. In the BBC radio interview last month, he claimed he had
given away "a few hundred million as of now".

And his generosity didn't just extend to charities. In the last six months, the
"King of Crypto" was given another nickname - "Crypto's White Knight".

With the price of cryptocurrencies falling in 2022, the so-called "Crypto
Winter" is in full swing. While other companies in the industry faltered, Mr
Bankman-Fried was handing out bailout cash in the hundreds of millions.

Asked why he was trying to prop up failing crypto firms, he told CNBC: "It's not
going to be good long-term if we have real pain and real blow outs. And it's not
fair to customers."

He also claimed, in the same interview, to have $2bn in reserve that he could
use to help failing crypto companies.

But last week, he was going around the same industry himself, trying to raise
money to save his own company and customers.

Questions about the real financial stability of FTX began swirling after an
article on the CoinDesk website suggested that much of Mr Bankman-Fried's
trading giant Alameda Research rests on a foundation largely made up of a coin
that a sister company of FTX invented, not an independent asset.

Further accusations that Alameda Research used FTX's customer deposits as loans
for trading were made in the Wall Street Journal.

The beginning of the end came though when FTX's main competitor - Binance -
publicly sold off all its crypto tokens linked to FTX a few days later.

Binance chief executive Changpeng Zhao told his 7.5 million followers his
company would be selling off the holdings "in light of recent revelations".

Image source, Getty Images
Image caption,
Binance boss Changpeng Zhao shared terse exchanges on Twitter with his rival Mr
Bankman-Fried

It sparked a run on FTX, with panicked customers withdrawing billions of dollars
from the cryptocurrency exchange.

Withdrawals were halted and Mr Bankman-Fried tried to get a bailout, with
Binance at one stage publicly considering a buyout before walking away.

Binance said reports of "mishandled customer funds and alleged US agency
investigations" had swayed its decision.

A day later, FTX was declared bankrupt.

Mr Bankman-Fried apologised in a series of tweets saying: "I'm really sorry,
again, that we ended up here.

"Hopefully things can find a way to recover. Hopefully this can bring some
amount of transparency, trust and governance to them."

He also said he "was shocked to see things unravel the way they did".

So was, and is, the crypto world. The price of Bitcoin has fallen to a two-year
low and many are wondering - if FTX can go down along with its talismanic
leader, what could fall next?



Have you been affected by the collapse of the cryptocurrency exchange FTX? Share
your experiences by emailing haveyoursay@bbc.co.uk.

Please include a contact number if you are willing to speak to a BBC journalist.
You can also get in touch in the following ways:

 * WhatsApp: +44 7756 165803
 * Tweet: @BBC_HaveYourSay
 * Upload pictures or video
 * Please read our terms & conditions and privacy policy

0/500


YOUR CONTACT INFO






I accept the Terms of Service

Submit

In some cases a selection of your comments and questions will be published,
displaying your name and location as you provide it unless you state otherwise.
Your contact details will never be published.

At no time should you endanger yourself or others, take any unnecessary risks or
infringe any laws.

The BBC retains the right to select from these contributions based on editorial
requirements and subject to online terms and conditions and BBC editorial
guidelines. For more information about how the BBC handles your personal data,
see here.

Made with Hearken | Terms of Service | Privacy Policy

If you are reading this page and can't see the form you will need to visit the
mobile version of the BBC website to submit your question or comment or you can
email us at HaveYourSay@bbc.co.uk. Please include your name, age and location
with any submission.


MORE ON THIS STORY

 * Crypto giant FTX collapses into bankruptcy
   
   2 days ago
   
   

 * 'I'm waiting to get £2,000 back from crypto giant'
   
   3 days ago
   
   


RELATED TOPICS

 * Companies
 * Bitcoin
 * Cryptocurrency





TOP STORIES

 * Russia guilty of war crimes in Kherson - Zelensky
   
   Published
   3 hours ago

 * 'I couldn't stay silent about Putin and the war'
   
   Published
   3 hours ago

 * Live. 
   
   Biden and Xi to meet in Bali as US-China ties sour




FEATURES

 * 'I couldn't stay silent about Putin and the war'
   
   

 * Inside Kherson: Joy, tears - and talk of justice
   
   

 * What is the G20 and what will world leaders discuss in Bali?
   
   
 * 

 * The 'nomad' flower scientist who India forgot
   
   

 * Five mysteries about our Universe. VideoFive mysteries about our Universe
   
   

 * The simple diet change that will boost your memory
   
   

 * How did Qatar get to host the World Cup? VideoHow did Qatar get to host the
   World Cup?
   
   

 * What Democratic Senate means for Biden and Trump
   
   

 * The fall of ‘King of Crypto’ Sam Bankman-Fried
   
   




ELSEWHERE ON THE BBC

 * The X-rated cartoon that shocked the US
   
   

 * The sand battery making waves in Finland
   
   

 * The mindset employers want now
   
   




MOST READ

 1.  1
     'I couldn't stay silent about Putin and the war'
 2.  2
     Suspect arrested after six killed in Istanbul blast
 3.  3
     Republican anger over midterm election failings
 4.  4
     Dolly Parton gets $100m award from Jeff Bezos
 5.  5
     Russia guilty of war crimes in Kherson - Zelensky
 6.  6
     Ronaldo says he feels 'betrayed' by Man Utd
 7.  7
     The fall of ‘King of Crypto’ Sam Bankman-Fried
 8.  8
     Man says Magaluf bouncer almost killed him
 9.  9
     Braverman to sign migrant patrols deal with France
 10. 10
     Man who lived in Paris airport for 18 years dies







BBC NEWS SERVICES

 * On your mobile
 * On smart speakers
 * Get news alerts
 * Contact BBC News

 * Home
 * News
 * Sport
 * Reel
 * Worklife
 * Travel
 * Future
 * Culture
 * Music
 * TV
 * Weather
 * Sounds

 * Terms of Use
 * About the BBC
 * Privacy Policy
 * Cookies
 * Accessibility Help
 * Parental Guidance
 * Contact the BBC
 * Get Personalised Newsletters
 * Why you can trust the BBC
 * Advertise with us
 * AdChoices / Do Not Sell My Info

© 2022 BBC. The BBC is not responsible for the content of external sites. Read
about our approach to external linking.