SBF Admits Failures Caused By Expansion Too Fast
Sam Bankman-Fried (SBF) said in an interview that hedge fund Alameda has accumulated a large number of “margin positions” on FTX. He also admitted that the rapid expansion of market share was also one of the causes leading to this unfortunate collapse. Sam declined to comment on possible jail terms and declined to disclose his current location.
In an interview with The New York Times, former FTX CEO Sam Bankman-Fried (SBF) said in an interview that hedge fund Alameda has accumulated a large number of “margin positions” on FTX, this actually means that Alameda borrowed a lot of money from the FTX exchange.
However, Bankman-Fried agreed with critics in the crypto community, who say he has expanded his business interests too quickly across a broad spectrum of the industry, arguing that he lack of warning signs of risk.
“Had I been a bit more concentrated on what I was doing, I would have been able to be more thorough,(…).That would have allowed me to catch what was going on on the risk side.”
The Bankman-Fried collapse stunned the crypto world. Earlier warning signs had emerged that his business empire was in jeopardy and that his ambitions were spiraling out of control, according to interviews with 9 colleagues and his business partners, as well as internal messages obtained by The New York Times.
When he embarked on a shopping spree this year, investing in crypto companies that were experiencing liquidity problems, he did not share information with key employees. When told he was overworked and encouraged to hire more staff, he turned down the offers.
As for previous investments in other companies, SBF said these venture capital investments may not really be worth it. Regarding SBF’s personal relationship with Alameda Research CEO Caroline Ellison, SBF said he and Ellison are no longer romantically involved but declined to comment further.
During a meeting with Alameda employees on Wednesday, Ellison explained what led to the company’s downfall, according to a person familiar with the matter. In recent months, Alameda has taken out loans and used the money to invest in venture capital, among other expenses, she said.
Around the time of the crypto market crash this spring, lenders began to recover those loans. But the money Alameda spent was no longer available, so the company used FTX customer funds to pay.
Bankman-Fried, who is based in the Bahamas, said he is still working actively with regulators to protect the interests of its customers. However, he declined to discuss the possibility of jail time in the interview and declined to comment on his current position, citing safety concerns. Attorneys for FTX and Bankman-Fried did not respond to requests for comment.
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