Facing U.S. criminal fraud charges, Sam Bankman-Fried (SBF) blamed the collapse of his FTX/Alameda empire on the market and a tweet from Binance CEO CZ.
Bankman-Fried Denies Stealing Funds, Blames Tweet by CZ
Sam Bankman-Fried (SBF) has published a blog post containing his take on the spectacular collapse of his FTX and Alameda Research empire. In it, he pins the blame for the multibillion-dollar failure generally on crypto market conditions in 2022, and acutely on a “fateful tweet” by Binance CEO Changpeng Zhao (CZ).
SBF, who was arrested in the Bahamas in December on U.S. fraud charges and now awaits criminal trial in the U.S., admits that “Alameda failed to sufficiently hedge its market exposure.” But that’s about the extent to which he takes responsibility or admits any mistakes or wrongdoing.
“I didn’t steal funds, and I certainly didn’t stash billions away,” SBF claims.
Instead, he passes the the blame on market events in 2022 like the crash of Three Arrows Capital and Luna, and criticizes advice from lawyers, subsequent actions from FTX International and FTX US, and even the timing of his arrest by law enforcement.
Most pointedly, he directly attributes the collapse of his FTX empire to Binance CEO CZ.
“In November 2022, an extreme, quick, targeted crash precipitated by the CEO of Binance made Alameda insolvent,” SBF said.
It is extremely unusual for a sitting U.S. criminal defendant to make public statements about the offenses that have been alleged against them. After all, the standard Miranda warning states: “You have the right to remain silent and refuse to answer questions. If you give up the right to remain silent, anything you say can and will be used against you in a court of law.”
It doesn’t appear that conventional advice will be followed by SBF, however.
“I have a lot more to say–about why Alameda failed to hedge, what happened with FTX US, what led to the Chapter 11 process, S&C, and more. But at least this is a start,” he concluded.
His criminal trial is scheduled to begin in October.
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