FTX's Downfall: Sam Bankman-Fried Shifts Blame Away from Himself

Police & Regulations
Sep 16, 2023 at 03:20 pm

In recently disclosed private writings obtained by the New York Times, Sam Bankman-Fried, the founder of FTX, expressed deep concerns about being perceived as one of the most disliked figures globally. The documents provide insight into Bankman-Fried's state of mind during his time under house arrest, both preceding and following the collapse of his cryptocurrency empire.

One of the most striking revelations is Bankman-Fried's apparent reluctance to shoulder any responsibility for the financial debacle, including the baffling disappearance of $8 billion, the devastating losses suffered by individuals, and the potential consequences he may face, including a lengthy prison sentence. Surprisingly, his primary regret seems centered on his tarnished public image, as if court hearings and the bankruptcy proceedings are mere distractions from the illustrious statesman role he once envisioned for himself.

Bankman-Fried's poignant words were: "I'm broke and wearing an ankle monitor and one of the most hated people in the world. There will probably never be anything I can do to make my lifetime impact net positive."

While the New York Times did not provide specific context for when or why these words were written, they appear to be from a personal diary that was leaked to the press. The level of self-absorption reflected in these sentiments is astonishing, especially considering the extensive financial losses experienced by many.

It is evident that Bankman-Fried's opulent lifestyle, which included a penchant for luxury real estate, private jets, and on-demand services, crumbled alongside his company. This further underscores how his public persona as an unassuming billionaire was a façade.

More concerning is his reported statement: "And the truth is that I did what I thought was right." This sentiment, coupled with his earlier statement, reflects a "the ends justify the means" mentality that contributed to Bankman-Fried's predicament.

A recent Bloomberg Businessweek article about Bankman-Fried's parents sheds light on the family's philosophical inclinations. Despite their son's fall from grace, Joseph Bankman and Barbara Fried, both Stanford Law School professors, continue to stand by him. Bankman, in particular, played a role in FTX, offering tax advice and acting as a mediator for his son.

Bankman-Fried's philosophical leanings as a consequentialist, pondering ethical dilemmas akin to the Trolley Problem, reflect the family's inclination towards a do-gooder mindset. However, it raises questions about the actual consideration of consequences in their actions.

While Bankman-Fried appears reluctant to confront his own decisions, he seems keen to highlight the perceived mistakes of others, notably his ex-girlfriend and ex-employee Caroline Ellison. He places significant blame on her for a trade gone awry that purportedly led to the downfall of FTX and Alameda.

Despite vague awareness of the "Fiat@" account's involvement in misappropriating customer funds, Bankman-Fried maintains he had no direct involvement. Instead, he attributes the narrative of fund misappropriation to the law firm Sullivan & Cromwell, overseeing FTX's bankruptcy proceedings.

In the grander scheme of things, it is perplexing how Bankman-Fried was seemingly indifferent to consequences before facing legal troubles, and now, with his desired outcomes seemingly unattainable, he remains unfazed. It is a regrettable turn of events, especially in light of his earlier affirmation of the importance of truth.

Related News

Sign up for daily crypto news in your inbox

Get crypto analysis, news and updates right to your inbox! Sign up here so you don't miss a single newsletter.