“There is nothing I Can Do to Make It Positive” Sam Bankman-Fried’s Perspective on Impact and Responsibility

2023-09-28, 03:07

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## [TL; DR]
Sam Bankman-Fried who is facing trials for several criminal charges feels dejected and hopeless.

SBF has pleaded innocence to the charges levelled against him which include misappropriation of FTX customers’ funds.

Financial mismanagement and Bankman-Fried’s lavish lifestyle might have contributed to FTX collapse.
## Introduction
Before [the FTX collapse in 2022](https://www.gate.io/blog_detail/1777/ftx%E4%BA%8B%E4%BB%B6%E8%BF%9B%E8%A1%8C%E6%97%B6-%E5%A4%9A%E7%B1%B3%E8%AF%BA%E9%AA%A8%E7%89%8C%E5%80%92%E5%90%91%E4%BD%95%E6%96%B9 "the FTX collapse in 2022"), Sam Bankman-Fried had become one of the most prominent people in the crypto sector since he owned a vibrant cryptocurrency exchange. Some people hailed him as a saviour of the crypto industry after he bailed two cryptocurrency firms from imminent implosion. However, his fame dissipated when FTX exchange and its sister company Alameda Research crashed.

In this post, we shall discuss how Bankman-Fried has become hopeless and feels unable to have a positive impact on the crypto sector. We will also include a short chronology of events that led to the collapse of FTX crypto exchange.

Related news: [SBF Wants To Pay Expert Witnesses $1200 Per Hour](https://www.gate.io/de/blog_detail/3197/sbf-pays-witnesses-post-ftx-collapse "SBF Wants To Pay Expert Witnesses $1200 Per Hour")
## Bankman-Fried: A Fall from Prominence to Disgrace
At the time of writing Sam Bankman-Fried, the founder and former CEO of FTX crypto exchange, feels that he is now powerless to have an impact on the crypto sector like before. That is why he said, “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.”

According to his 250 pages of writing he compiled since the time he was under house arrest which started in December 2022, Bankman-Fried, popularly known as SBF, said it is now very difficult for him to change the negative perception that people have about him. As a result, he said that he feels “broke” and “hated.”

It is currently not clear how Tiffany Fong, a crypto journalist/Youtuber, got hold of Bankman-Fried’s piece of writing which he shared with the New York Times. Some of the writings are planned X (formerly Twitter) posts which clarify his role in the collapse of FTX and its related affiliates.

Read also: [FTX Shows Massive Shortfalls in Firm's Assets](https://www.gate.io/de/blog_detail/2390/ftx-shows-massive-shortfalls-in-firms-assets "FTX Shows Massive Shortfalls in Firm's Assets")

Significantly, Bankman-Fried apportions the blame for the collapse of FTX on some of his compatriots, including Caroline Ellison, his ex-girlfriend and former CEO of Alameda Research.

Related news: [Alameda's $700M Pursuit for Celebrity-Political Access](https://www.gate.io/tr/blog_detail/2867/alameda-s-700m-pursuit-for-celebrity-political-access "Alameda's $700M Pursuit for Celebrity-Political Access")

In another leaked document, Bankman-Fried gave details of Ellison’s contribution to the [collapse of FTX and Alameda Research Trading firm](https://www.gate.io/th/blog_detail/1748/disclosure-about-alameda-and-ftx-how-can-users-avoid-risks-when-organizations-are-in-chaos "collapse of FTX and Alameda Research Trading firm"). He wrote, “She continually avoided talking about risk management — dodging my suggestions — until it was too late. [...] Every time that I reached out with suggestions, it just made her feel worse. I’m sure that being exes didn’t help.”

At the same time, Bankman-Fried maintains that he was unaware that Alameda Research was misappropriating customer funds until he heard that from a group of employees who were discussing the issue among themselves in the spring of 2022.

Recent news: [Singapore Temasek Named in FTX amidst Struggles](https://www.gate.io/blog_detail/3102/-singapore-temasek-misplaced-trust-ftx "Singapore Temasek Named in FTX amidst Struggles")
## Bankman-Fried Pleads Innocent despite Much Evidence Against him
Bankman-Fried, accused of [various crimes including misusing customer funds, wire fraud and money laundering, has pleaded innocence to the charges](https://www.gate.io/explore/ftx-sbf "various crimes including misusing customer funds, wire fraud and money laundering, has pleaded innocence to the charges"). However, recently Judge Lewis A. Kaplan dismissed Bankman-Fried’s application for a pretrial release so he can prepare fully for the case.

According to Judge Kaplan, Bankman-Fried's application for a pre-trial release lacks merit. He said, “Defendant largely ignores the fact that he had extensive access to most of the ESI (electronically stored discovery and other material) for 7 ½ months before his bail was revoked.”

Sam Bankman-Fried, born in 1992 and a holder of a bachelor’s degree in physics from the Massachusetts Institute of Technology (MIT), founded FTX cryptocurrency exchange in 2018. He also co-founded Alameda Research, a quantitative trading firm that specialized in cryptocurrencies.

According to Forbes, [before the FTX crash](https://www.gate.io/blog_detail/1792/ftx-event-and-its-domino-effects "before the FTX crash"), Bankman-Fried's financial fortune was around $26.5 billion. As a result, he became one of the largest donors for the Democrats in the United States, contributing more than $5.2 million to President Joe Biden's 2020 political campaign.

There is no doubt that Bankman- Fried was one of the richest persons in the world in 2022 before the collapse of the cryptocurrency exchange, [FTX](https://www.gate.io/price/ftx-ftt "FTX"), and Alameda Research. Nevertheless the story is different now considering that he is under house arrest and is battling to prove himself innocent to a plethora of high level criminal charges.

Sadly, Bankman-Fried is now associated with one of the largest financial frauds in history. On 13 December 2022, Damian Williams, The U.S. Attorney for the Southern District of New York, announced an eight-point fraud indictment against him that included a gross mishandling of customer funds.

Read also: [Former FTX Executive Riyan Salame Pleads Guilty](https://www.gate.io/blog_detail/3219/former-ftx--utive-guilty-plea "Former FTX Executive Riyan Salame Pleads Guilty")
## SBF’s FTX Cryptocurrency Exchange
A brief background information on SBF owned FTX cryptocurrency exchange can enable you to tell how Bankman-Fried has fallen from prominence to disgrace.

In 2021 FTX, formed in 2018, was the third largest cryptocurrency exchange in the world. Its portfolio included leveraged products and derivatives. In addition, it also provided spot trading for more than 300 crypto pairs like BTC/USDT, <a href="/price/xrp-xrp" target="_blank" class="blog_inner_link">XRP</a>/USDT, ETH/USDT and FTT/USDT.

In general, FTX had two units, the Bahamas-based FTX and its FTX US affiliate, which had overlapping management teams, something that contributed to its downfall. However, the two units had separate capital structures.

Both units, though, offered similar products which included spot markets, futures, MOVE contracts, leveraged tokens and options. At one time, FTX was valued at over $32 billion which was equivalent to about 25 billion British  Pounds. It used to have a daily trading volume of $10-$15 billion, something a few crypto exchanges would attain in 2022.

Also, FTX exchange had its native cryptocurrency [called FTX token (FTT)](https://www.gate.io/learn/articles/what-is-ftx-token/397 "called FTX token (FTT)") which attracted many traders. Specifically, the exchange used to give discounts to customers who traded FTT. Notably, Alameda Research was one of the largest holders of FTT.

Further to that, FTX supported nine fiat currencies including the U.S. dollar, Australian dollar, Canadian dollar, euro, British pound, Ghanaian cedi, Swiss franc, Argentine peso and Brazilian real.

Bankman-Fried’s lifestyle might have contributed to FTX implosion. Although he portrayed himself to the public as a simple man who used to wear nonde_script_ clothing he lived a lavish lifestyle in the Bahamas which, however, attracted less public attention. 
## How FTX Crypto Exchange Fell from Dominance to Bankruptcy
During mid-2022 no sane person would have imagined that FTX exchange would falter and fail. However, in October of the same year several events unfolded resulting in the total failure of the crypto exchange.

A crypto news article which CoinDesk published in October triggered the downfall of FTX. The article suggested that the viability of Alameda Research depended on its large holding of FTT, not an independent crypto asset.

Around the same time the Wall Street Journal also published the information that Alameda Research had used FTX’s customer deposits as collateral for its loans for trading.

A few days later Binance sold its FTT holding to the public as a result of the information which CoinDesk and Wall Street Journal had published. In fact the emerging details about the "mishandled customer funds and alleged US agency investigations," forced Binance to disassociate itself from FTX exchange.

These events created panic among FTX users who started withdrawing most of their funds. In fact, within a short time the customers withdrew billions of dollars. As a result, the exchange halted withdrawals as Bankman-Fried sought ways to bail out the exchange. However, in the end the exchange became bankrupt.

Currently, Bankman-Fried is under trial in the United States for the various crimes he is deemed to have committed. Already, several of FTX’s former executives including Riyan Salame,  Caroline Ellison (former Alameda chief executive officer), Gary Wang (former FTX technology chief) and Nishad Singh (former FTX engineering chief) have pleaded guilty to the charges placed against them. 
## Conclusion 
Sam Bankman-Fried feels dejected and hated after the collapse of FTX crypto exchange in 2022 and the lawsuit he is facing in the United States. The truth is that many people who used to view him as an important person in the crypto sector now see him as a fraudster.

<div class="blog-details-info">
<div>Author:** Mashell C.**, Gate.io Researcher
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>