The outcome of the FTX matter is pending to await the start of reimbursement to the unfortunate victims.
Before November 2022, no one expected that the American cryptocurrency exchange FTX, valued at over $32 billion, would experience such a tragic end. Colossal losses for the company, its creditors and its founder Sam Bankman-Fried, investments of thousands, even hundreds of thousands of dollars, lost to its creditors (individuals and institutions included), falling prices of cryptocurrencies (Bitcoin, Ethereum, etc.).
The toll is high. Now that the young deposed CEO of FTX is called to court to answer for his actions, here are some details that are sure to give the readers goosebumps.
FTX, The Biggest Crypto Scam of the Century?
It is timely to remember Bernard Madoff, the man who defrauded the largest financial institutions of $65 billion in 2008. The entire world fell apart when his Ponzi scheme was brought down.
Sam Bankman-Fried, a young student-like man who ran the second largest cryptocurrency exchange in the world, behind Binance, did the same again 14 years later. Crypto media did not hesitate to establish the connection between the two scammers once the news broke.
As soon as FTX fell, losses worth tens of billions of dollars were reported. To be more precise, about $10 billion, including liquid and illiquid assets. In this crypto storm, the crypto assets of creditors (wealthy investors, companies of all kinds, individual investors, etc.) vanished. Nearly 130 companies, including Alameda Research, are said to have collapsed in the process.
At the same time, the market value of FTX (FTT), estimated at $32 billion at the beginning of the year, fell sharply. Likewise, the value of the global crypto market has plummeted: the $3 trillion mentioned for November 2021 represented just a mere mirage following the collapse of the SBF exchange.
Whose Fault Is It?
So far, the responsibility for this crypto scourge has fallen on this Palo Alto mama’s boy, Sam Bankman-Fried. Their setbacks (naming sports infrastructures, crazy spending on advertising, financial support for Democratic candidates, purchasing luxury goods of all kinds, etc.) have not gone unnoticed by the crypto community.
However, young Sam did not stop pointing the finger at others responsible for the fall of FTX. Among them, he cited Changpeng Zhao (CZ), his eternal rival, who allegedly practiced unfair competition with a view to monopolizing the cryptocurrency market. Cointelegraph published an article detailing these mutual accusations on the day of the FTX collapse.
SBF also mentioned other names among those close to him, such as Caroline Ellison, ex-girlfriend and former CEO of Alameda Research. The name of the latter constantly circulates in the Court.
But considering how things are developing, the court in charge of the FTX case will not stop calling the parents of Sam Bankman-Fried, Barbara Fried and Joseph Bankman. In fact, both are involved in the launch of the native cryptocurrency FTT.
Meanwhile…SBF’s Trial First Day
The first day of Sam Bankman-Fried’s (SBF) trial ended without final jury selection. The trial will continue for another day. The United States District Court for the Southern District of New York plans to select 12 jurors and six alternates.
Judge Lewis Kaplan dismissed several potential jurors on Oct. 3 due to conflicts of interest and other reasons. Assistant U.S. Attorney Danielle Sassoon named several potential witnesses and people connected to the case.
It remains uncertain whether SBF will testify, although he has previously stated his innocence. The process is expected to take up to six weeks.
By Leonardo Pérez
