After the November collapse of FTX, the cryptocurrency exchange he founded in 2019,unexpectedly gave a series of interviews intended to present his version of events. He was indicted in December and charged with perpetrating one of the biggest frauds in U.S. history – and he’s still talking, either in person or on the internet.
Bankman-Fried’s most immediate concern, however, is a recent private communication. Prosecutors say he sent an encrypted message over the Signal texting app on Jan. 15 to the general counsel of FTX US, a likely witness for the government. Bankman-Fried will be back in a New York court Thursday, where a judge could imposeBefore its collapse, FTX was the world’s second-largest crypto exchange and Bankman-Fried, 30, was its CEO and a billionaire several times over, at least on paper.
Those assertions are likely to be refuted by one of the government’s key witnesses. Caroline Ellison, the former CEO of Alameda, has agreed to plead guilty for her role in FTX’s collapse and to testify against Bankman-Fried. In a plea hearing in December, Ellison said she knew FTX had used billions in customer funds to make loans to Alameda and agreed with Bankman-Fried and others to take steps to conceal the nature of the loans.
For instance, Bankman-Fried says that when FTX collapsed, outside parties had made funding offers totalling billions of dollars, and if given a few weeks the company could have raised enough money “to make customers substantially whole.” Instead, it was “strong-armed” into filing for bankruptcy protection by its main law firm, Sullivan & Cromwell, a claim the firm denies.
Bankman-Fried was scheduled to testify under oath in front of Congress in December with Ray, but that appearance was cancelled because of his arrest in the Bahamas, where FTX is based.