You’ve probably seen the name Sam Bankman-Fried in headlines this week. While the scandal involving his crypto company FTX is convoluted, here are the basics you should know about the mega Democrat donor and his multibillion-dollar scam operation.
Bankman-Fried was the CEO of FTX, a cryptocurrency exchange based out of the Bahamas. On Nov. 8, Bankman-Fried announced on Twitter that the FTX exchange had run out of money to process the uptick in customer withdrawal requests. FTX immediately halted customer withdrawals and the result was a $10 billion hole as millions of cryptocurrency investors were left with frozen trading accounts and little hope of recovering funds. Within hours of FTX freezing customer assets, Bankman-Fried’s net worth plummeted in the biggest single-day loss of net worth by a billionaire on record, dropping from over $15 billion to nothing in a matter of days.
Why Did FTX Unravel?
On Nov. 6, it became known to the public that FTX had several large financial positions that were in danger. This news created an uptick in customer withdrawal requests from the FTX exchange as some customers became worried that FTX could run out of funds if their positions failed.
The FTX exchange also had its own cryptocurrency (FTT) which had a valuation of several billion dollars and was used primarily as a way to invest in FTX, and gain benefits such as lower fees on the FTX trading platform. Following the news that FTX positions were in…
