“I’ve had a bad month,” said the former CEO of the fallen crypto exchange FTX, speaking at the DealBook Summit.
Sam Bankman-Fried — the 30-year-old dethroned billionaire who fell from grace last month with the bankruptcy of his cryptocurrency exchange, FTX, and revelations of missing customer funds — was notably fidgety, hemmed and hawed over his answers, and seemed at times to martyr himself in much anticipated first public interview since his company, valued to be worth at least $32 billion, simply imploded.
“I’ve had a bad month,” Bankman-Fried said at one point, an understatement that drew a burst of laughter from the audience at the New York Times’s DealBook Summit, an annual elite conclave of global corporate leaders, investors, politicians, and celebrities. The former wunderkind CEO, who had graced magazine covers, mingled with Washington power players, and funded philanthropic causes before the stunning collapse of his exchange, told the New York Times’s Andrew Ross Sorkin that he was down to one last credit card and about $100,000 in a bank account.
He also said that his lawyers didn’t think it was a good idea for him to be speaking. Bankman-Fried said he was being given the “classic advice — don’t say anything. Recede into a hole.”
“I think I have a duty to talk to people,” he said. “I have a duty to explain what happened.”
What happened was the astonishing collapse of the cryptocurrency exchange Bankman-Fried founded, sending shock waves through not only financial and crypto circles but political and philanthropic ones as well. The company, currently in bankruptcy proceedings, is being investigated by the Justice Department and the Securities and Exchange Commission, according to the Wall Street Journal. At least $1 billion in FTX customer funds appears to be missing.
Bankman-Fried, who had been seen as a rare billionaire serious about using his wealth to improve the world following a philosophy known as effective altruism, has now left philanthropic organizations to which he committed money grappling with funding gaps. FTX’s ruin has led to “crypto contagion” in the rest of the industry, ushering in widespread instability: BlockFi, a crypto lending company that FTX bailed out in July, also filed for bankruptcy this week, and the crypto exchange Kraken announced that it will lay off 30 percent of its workforce. (Disclosure: This August, Bankman-Fried’s philanthropic family foundation, Building a Stronger Future, awarded Vox’s Future Perfect a grant for a 2023 reporting project. That project is now on pause.)
Bankman-Fried did not attend Wednesday’s event in person but was interviewed virtually from the Bahamas, where he’s been based since late 2021. When he came into view around 5 pm, his demeanor was subdued, compared with the fast-talking, frenetic energy he is known for during public appearances.
In introducing Bankman-Fried, Sorkin pulled no punches: “The generous view is that you are a young man who made a series of terrible, terrible, very, very bad decisions. The less generous view is that you have committed a massive fraud.” Bankman-Fried’s answers seemed to push for the more generous read, but their vagueness failed to dispel the less kind perceptions the public holds.
Bankman-Fried, who is well known for his unusual aesthetic — he loved to wear baggy shirts and shorts that communicated a kind of asceticism — wore a loose-fitting plain black T-shirt and sat in an unremarkable room with little more than a houseplant visible in a corner. At various points in the roughly hour-long Q&A, his body language was hunched, his head and gaze lowered as he answered a barrage of difficult questions from Sorkin, including where FTX customers’ money had gone, whether employees had used drugs, what he had told his Stanford law professor parents, and what he saw for his future.
At one point, Sorkin referenced a letter he received from someone who accused the former billionaire of stealing about $2 million from him, asking why Bankman-Fried had “decided to steal my life savings.” Did Bankman-Fried think what he did was fraud?
Bankman-Fried’s head hung as Sorkin read the letter. “I’m deeply sorry about what happened,” he said before quickly adding that, “to his knowledge,” FTX’s US platform was “fully solvent.”
Moments earlier, he said, “I didn’t ever try to commit fraud on anyone.”
Bankman-Fried appeared remarkably calm for a man some are comparing to Elizabeth Holmes and Bernie Madoff. He was repeatedly apologetic but maintained that he didn’t know the details of exactly what had happened and why — only that he had failed in his duty as the CEO of FTX, while emphasizing a lack of oversight and poor risk management. When Sorkin mentioned allegations that employees at FTX had used drugs, Bankman-Fried characterized himself as an innocent: “I had my first sip of alcohol after my 21st birthday,” he said, and said that FTX did not have wild parties, and that if there were parties, employees played board games.
The DealBook Summit is a self-described space for “unguarded conversations about business, culture, and politics.” It’s set up as an elite gathering of people with the influence to shape the worlds of finance, business, and politics; a regular ticket has a $2,499 price tag. Among the panoply of famous names in attendance this year were Netflix CEO Reed Hastings, Amazon CEO Andy Jassy, Meta CEO Mark Zuckerberg, and Ukrainian President Volodymyr Zelenskyy.
It has typically been a friendly stage for business leaders, and past interviewees include Elon Musk as well as venture capitalist and Republican megadonor Peter Thiel, Apple CEO Tim Cook, Twitter co-founder Jack Dorsey, and Microsoft co-founder and philanthropist Bill Gates. Last year’s virtual summit, however, invited disgraced WeWork founder Adam Neumann for his first interview about two years after the corporate scandal that tarnished his reputation.
Unlike Neumann, Bankman-Fried did not wait two years after his public immolation to do an interview, and it seems he isn’t loath to attract more attention. Since FTX’s collapse, and since allegations of fraud surfaced a few weeks ago, Bankman-Fried has been uncommonly talkative on Twitter and with journalists. He was bewilderingly candid in a Twitter DM interview with Vox journalist Kelsey Piper, pulling back the curtain on the kind of reputation-polishing that, as Bankman-Fried implies, all powerful people — including himself — engage in. In his DMs, the mask of his image as a thoughtful philanthropist and diplomatic crypto spokesperson slipped; he said bluntly, on the issue of crypto regulation, “fuck regulators” and espoused the view that the world cared more about who they perceived as “winners” than people who were actually ethical.
Bankman-Fried attempted to clarify and soften some of the comments in that interview at the DealBook Summit, saying that he genuinely cared about important issues such as animal welfare and pandemic prevention. But he stood firm on the idea that “doing good” was often a PR game that companies played. “There’s a bunch of bullshit that regulated companies do,” he said. “It’s just a PR campaign masquerading as do-gooderism.” He acknowledged that he, too, had participated in such PR campaigns. “Yeah. We all did.”
After Bankman-Fried’s Vox interview, the current CEO of FTX, John Ray III (who helped restructure Enron when it went bankrupt), released a terse reminder on Twitter that Bankman-Fried no longer spoke on behalf of the company. On Wednesday, however, Bankman-Fried had plenty to say about FTX. Sorkin pressed him on the specifics of what had happened and what he had known, asking him early about whether there had been a commingling of funds between FTX and the trading firm Bankman-Fried had founded, Alameda Research. Alameda has been accused of borrowing FTX customers’ funds. “I didn’t knowingly commingle funds,” Bankman-Fried replied. He said he realized belatedly that FTX client money and Alameda money had been tied together “substantially more” than he would have wanted it to be.
As Bankman-Fried continued to repeat that he hadn’t been aware of the true financials of both companies, Sorkin was blunt: “But, Sam, I think the question is whether you were supposed to have access to these [customer] accounts to begin with.”
Bankman-Fried avoided that question, insisting again that he had little involvement in Alameda.
Bankman-Fried’s presence at the summit raised numerous questions: Does hearing from a disgraced business leader on such a large stage help the public get closer to the truth about what happened? Or does it hand back some control to a powerful person, allowing them to prune their public image and inject an exculpatory spin on the unfolding narrative of FTX and of Bankman-Fried himself?
When asked whether he had been honest during the interview, Bankman-Fried’s answer was a perfect encapsulation of the vagueness and word-twisting he’d displayed during the interview. “I was as truthful as, you know, I am knowledgeable to be,” he said. And then, as if he was thinking better of the hedging, he added: “Yes, I was.”