Crypto billionaire Sam Bankman-Fried blames himself for FTX collapse, admits he ‘screwed up’

Crypto billionaire Sam Bankman-Fried blames himself for FTX collapse, admits he ‘screwed up’

Tron's Justin Sun says he and his team

Sam Bankman-Fried of FTX tweeted Thursday morning that he was “sorry”, admitting that he “screwed up” and “should have done better”. Bankman-Fried also announced that FTX’s sister company, trading firm Alameda Research, is ceasing trading.

The announcement comes as the former hero of the crypto sector is begging for billions of dollars to stave off bankruptcy.

This week for FTX was a rapid decline. Earlier this year, the exchange was valued at $32 billion, but now Bankman-Fried is again looking for someone to back FTX after rival exchange Binance pulled out of a takeover deal.

“I should have communicated more recently,” Bankman-Fried wrote. “Transparent – my hands were tied for the duration of the possible Binance deal; I wasn’t allowed to say much publicly. But, of course, it’s up to me that we ended up there.”

The FTX CEO also provided an update on where things stand with his embattled crypto exchange.

Excluding its U.S. business, Bankman-Fried says its international business has a total market value of assets and collateral that is greater than customer deposits, but says that’s “different from liquidity for delivery — as you can see from balances and withdrawals. “

“Here is the complete story one by one, but as a very high level, I was wrong twice,” Bankman-Fried wrote.

FTX’s chief executive says his first mistake was poor internal labeling of bank accounts, which meant he was “significantly down” in his sense of customer margin. “I thought it was much lower.”

On Sunday, he said the stock market had withdrawn about $5 billion, which he called “the largest by a huge margin.”

Bankman-Fried says his number one priority “by far” is getting it “right by the user.” To that end, he says he and the team are spending the week doing everything they can to raise liquidity.

“I can’t promise anything about that,” he said. “But I’ll try.”

The FTX boss also says that they are in talks with a number of players about the next steps.

A few hours after Binance terminated the contract to buy FTX, Justin Sun – the founder of cryptocurrency tron tweeted at 10:00 PM on Wednesday that he was “putting together a solution” with crypto exchange FTX Sam Bankman-Frieda to “move the way forward.”

Sun was tight-lipped on the details of the arrangement, but said his team was “working around the clock to prevent further deterioration” and added that he believed the situation was “manageable” following the “holistic approach” he was putting together with his partners.

Although Bankman-Fried retweeted the post, it’s unclear whether Sun plans to buy FTX in a deal similar to the one announced with Binance earlier this week — or whether it’s just working to bail out tron ​​token holders on the beleaguered exchange.

It is also possible for the message to materialize without any action.

The Chinese-born businessman has been involved in numerous controversies and publicity stunts in the past. In 2019, he paid $4.6 million to have lunch with Berkshire Hathaway CEO Warren Buffet, only to abruptly cancel. The lunch was eventually held in 2020. He has been accused of unscrupulously copying other technologies, including the ethereum blockchain and the crashed algorithmic stablecoin terraUSD, for his own ventures, as previously reported by CNBC.

FTX said in an email to CNBC that what was shared via Twitter are the only official statements FTX will issue at this time. CNBC reached out to the Sun, but did not immediately respond to our request for comment.

“Every penny of that – and the existing collateral – will go directly to the beneficiaries, unless or until we do it right,” he promised in his tweet thread on Thursday.

“After that, investors — old and new — and employees who fought for what was right for their careers, and who weren’t responsible for any of the f—ups.”

This is a developing story. Check back for updates.

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