Disgraced FTX founder Sam Bankman-Fried told former employees he’s “deeply sorry” concerning the implosion of his crypto exchange — but continued to point the finger at the corporate’s bankruptcy filing, insisting that he could have saved the platform if given enough time.
“I feel deeply sorry about what happened. I regret what happened to all of you,” Bankman-Fried — who reportedly purchased lots of of hundreds of thousands of dollars price of pricey real estate within the Bahamas, at the same time as he claimed to champion “effective altruism” — told his employees within the letter.
“I didn’t mean for any of this to occur, and I’d give anything to give you the chance to return and do things once again,” the 30-year-old Bankman-Fried wrote. “You were my family. I’ve lost that, and our old house is an empty warehouse of monitors.”
“After I turn around, there’s nobody left to seek advice from,” he whined.
The letter was posted on FTX’s internal Slack channel by a staff member. Bankman-Fried resigned as CEO and isn’t any longer employed by the corporate, based on CoinDesk.
Bankman-Fried’s company filed for bankruptcy protection earlier this month.Bloomberg via Getty Images
FTX attorneys told a bankruptcy judge in Delaware on Tuesday that “a considerable amount of assets have either been stolen or are missing.”
FTX filed for cover within the US after traders pulled $6 billion from the platform in three days and rival exchange Binance abandoned a rescue deal. The collapse has left an estimated 1 million creditors facing losses totaling billions of dollars.
In the course of the bankruptcy hearing this week, an attorney for FTX told a Delaware court that the corporate was run by Bankman-Fried as his own “personal fiefdom.”
FTX, led because the bankruptcy filing by recent CEO John Ray, also has accused Bankman-Fried of working with Bahamian regulators to “undermine” the US bankruptcy case and shift assets overseas.
Alameda Research was run by Bankman-Fried’s 28-year-old ex-girlfriend, Caroline Ellison.Twitter / @carolinecapital
The FTX founder, who is alleged to be under investigation by authorities within the US and his home base of the Bahamas, didn’t address allegations that customer funds were utilized by sister firm Alameda Research, run by his ex-girlfriend Caroline Ellison, to make dangerous bets.
In his letter, Bankman-Fried as an alternative continued to insist that he had a way out of the mess, writing to his employees: “Potential interest in billions of dollars of funding got here in roughly eight minutes after I signed the Chapter 11 docs.”
“Between those funds, the billions of dollars of collateral the corporate still held, and the interest we’d received from other parties, I believe that we probably could have returned large value to customers and saved the business.”
“I feel that there are billions of dollars of real interest from recent investors that might go to creating customers whole,” he wrote.
Bankman-Fried wrote within the letter that the plummeting value of cryptocurrencies cut FTX’s collateral in half to around $30 billion. The corporate’s liabilities were valued at $2 billion.
Bankman-Fried whined, “After I turn around, there’s nobody left to seek advice from.”Bloomberg via Getty Images
When cryptocurrencies did not get well, collateral fell even further to around $9 billion, based on Bankman-Fried, who lamented the “run on the bank” as account holders sought to withdraw their deposits.
“I didn’t realize the total extent of the margin position, nor did I realize the magnitude of the danger posed by a hyper-correlated crash,” Bankman-Fried wrote.
The chain of events led FTX to file for bankruptcy protection, he claimed.
Meanwhile, Sequoia Capital, the well-known Silicon Valley-based enterprise capital firm, apologized to its fund investors after it took a $150 million loss on FTX.
Sequoia partners told investors on an organization call that it might improve its due-diligence process on future investments, based on the Wall Street Journal.
The firm told its investors that it believes it was misled by FTX.
FTX is a cryptocurrency exchange that was once price some $32 billion.AFP via Getty Images
Nathaniel Whittemore, a CoinDesk podcaster who worked as FTX’s head of selling, said employees of the corporate weren’t aware that Bankman-Fried was using customer funds to cover Alameda’s debts.
Whittemore also said employees had no idea their life savings were gone.
“You might have to grasp just how devastated the common FTX worker was” after FTX did not get Binance to bail it out, Whittemore said.
“Not only, then, did it seem that they may be out of a job, but they were also potentially facing the whole lack of their savings.”
Whittemore’s comments were reported by Insider.