Sam Bankman-Fried is determined not to take his refuge in silence.
The former crypto king seems to believe he remains on top of the fledgling financial-services industry powered by blockchain technology.
He seems to think he’s still in a position from which every one of his tweets and words was watched by consumers and investors eager to know how high bitcoin prices could go and when the new crypto craze would pick up.
He seems to have forgotten that since November, what consumers and investors expect from him is to tell them whether one day they’ll be able to recover their money after his crypto empire declared bankruptcy on Nov. 11.
This empire was made up of the FTX cryptocurrency exchange and Alameda Research, a hedge fund that also served as a trading platform for institutional investors.
The two companies went bankrupt after their respective customers rushed to withdraw their money by selling the cryptocurrencies they had previously purchased.
FTX was using the client cryptocurrencies as collateral to borrow money which in turn it had transferred to Alameda Research with which it shares several links. Alameda used this money to invest in crypto businesses and also for trading operations.
‘I Certainly Didn’t Stash Billions Away’: SBF
John Ray, the former liquidator of energy broker Enron, was appointed CEO to handle the bankruptcy proceedings. Ray and his team have painted an unflattering picture of the Bankman-Fried regime.
“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” Ray wrote in a 30-page document filed with the U.S. Bankruptcy Court for the District of Delaware in November.
“From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.”
The Justice Department and the Securities and Exchange Commission have filed a series of criminal and civil charges accusing Bankman-Fried of fraud.
During a Jan. 3 hearing in U.S. District Court in New York Bankman-Fried pleaded not guilty. The trial is scheduled for Oct. 8.
Instead of waiting for trial, Bankman-Fried, known by the initials SBF in the crypto space, just launched a new response to the regulators.
Whether his lawyers tried to dissuade him is unclear.
“I didn’t steal funds, and I certainly didn’t stash billions away,” the former billionaire wrote in a blog spot on Jan. 12. “Nearly all of my assets were and still are utilizable to backstop FTX customers.”
“I have, for instance, offered to contribute nearly all of my personal shares in Robinhood (HOOD) – Get Free Report to customers.”</…….