The former CEO of FTX.US, the American subsidiary of the platform, comes out of silence. He paints a portrait of a tyrannical, unstable and angry Sam Bankman-Fried.
Just months after the FTX crash, the revelations are piling up. According to bankruptcy attorneys in the United States, the financial handling of the exchange was simply disastrous. While producing billions of dollars worth of cryptocurrencies, the company sorely lacked structure and professionalism. For example, there was no real accounting department within the company.
The accounts also show that FTX was spending excessive sums for restaurants or luxury apartments… while the cryptocurrency crash gradually ate away at its cash reserves. Not surprisingly, Sam Bankman-Fried (SBF), CEO and founder of the FTX empire, is held responsible for this historic debacle.
Sam Bankman-Fried asks for permission
Charged with embezzlement, the former billionaire was arrested by Bahamian police in December. Back on American soil, he managed to negotiate his release on bail pending trial, scheduled for October. Under house arrest in California, the former crypto white knight continues to maintain his innocence.
— SBF (@SBF_FTX) January 12, 2023
In an article published last week, Sam Bankman-Fried seems ready for anything blame others. The entrepreneur does not hesitate to point the finger at Alameda Research, a commercial company of which he left the presidency in 2019 to devote himself to FTX. According to him, the firm, led by Caroline Ellison, did not take sufficient precautions to protect itself from the crypto-asset crash. It was the fall of Alameda that would result in the death of FTX.
“I haven’t managed Alameda for a few years” recalls Sam Bankman-Fried, who was however the company’s majority shareholder businessrenowned for his aggressive strategies.
Sam Bankman-Fried also assures that FTX has been a victim ofan attack orchestrated by Binance, the number one trading platform in the industry. In fact, one of the first things that caused FTX users to panic was a tweet from Binance CEO Changpeng Zhao. However, it was a CoinDesk media investigation that set things on fire and revealed the insolvency of the FTX empire.
Read also: After the FTX disaster, what does 2023 hold for us?
Behind the scenes of the FTX empire
In the spotlight since the bankruptcy of FTX, Brett Harrison, former president of FTX.US, finally agreed to reveal behind the scenes. The man led the US arm of the exchange from May 2021 to September 2022. He resigned less than two months before FTX went bust, leaving it unclear about his reasons for leaving.
1/49 Many have asked me questions about my time at FTX US and why I left when I did. As I indicated earlier this week, I’m happy to start sharing my experiences and perspectives publicly.
—Brett Harrison (@BrettHarrison88) January 14, 2023
In a wireHarrison draws a bitter record of his collaboration with Sam Bankman-Fried. He recalls working with SBF before FTX and Alameda came into being within the company business Capital of Jane Street. The future billionaire was very popular at the time – he was ” a sensitive and intellectually curious person who took care of animals”Harrison says. As SBF later admitted, it was just a front to fix his image.
According to him, the founder of FTX has gradually transformed as his platform gained momentum. After agreeing to take the helm of FTX.US, Harrison realized how the company was really run. Apparently, Bankman-Fried could not stand the slightest contradiction:
“I recognized in this first conflict a sign of total insecurity and intransigence when its decisions were questioned”.
Drug addiction and threats
Upset by SBF’s aggressive communication, Harrison doesn’t hesitate to attribute this radical personality change to drug use. The executive believes that drugs profoundly affected Sam Bankman-Fried’s mind:
“I have family and friends who live with addiction and mental health issues, and I’ve seen how these issues often crop up without warning in early adulthood”.
Arrested by the Bahamas justice, Sam Bankman-Fried indicated that he consumes 10 mg of Adderall every four hours, accompanied by Emsam patches for depression. By his own admission, he uses them two amphetamine derivativessupplied by prescription, for years.
To avoid hassles, the FTX founder put pressure on his collaborators. After writing a letter contrary to SBF’s strategy, Harrison says he has received threats to force him to retract:
“Sam was uncomfortable with the conflict. Sometimes he responded with hostility. […] I was threatened with sacking in Sam’s name and with destruction of my professional reputation. I have been asked to formally withdraw what I have written and to apologise.”.
That’s why he preferred to leave the ship. To avoid an abrupt departure, the executive gradually delegated responsibilities to him before announcing his resignation. Bret Harrison says he never suspected the company of embezzlement and fraud. Seen from his window, he was alone ” management and organizational problems ».
In retrospect, the former CEO believes that FTX’s fraudulent activities were knowingly orchestrated by Sam Bankman-Fried and his inner circle. Sidelined from major decisions a few months after his arrival, Harrison could never suspect what was going on. American justice does not suspect him of participating in the fraud.