Sam Bankman-Fried “Misaccounted” $8 Billion Balance Sheet Deficit
Sam Bankman-Fried (SBF), FTX’s former CEO, exposed the money’s location in a recent Bloomberg interview. SBF stated that during an emergency bailout, he presented investors with a different balance sheet.
SBF has $8.9 billion in debt, $9 billion in liquid assets, and $15.4 billion in less liquid assets, according to the report. In addition, the study revealed $3.2 billion in illiquid assets.
The imbalance on FTX’s financial sheet continued to increase. The company first claimed only $2 billion before increasing it to $5 billion. The gap has now widened to more than $8 billion.
Sam Bankman-Fried produced another balance sheet that depicted the current state of affairs at the time of the bailout meeting. The balance sheet shows comparable figures but $8 billion fewer liquid assets. SBF stated that he misquoted the numbers.
According to a quote from SBF’s interview with ByZeke Faux:
Faux asked: “You didn’t have $8 billion in cash that you thought you had?
SBF: “That’s correct. Yes.”
Faux: “You misplaced $8 billion?”
Customers were directing money to Alameda Research rather than directly to FTX, he claimed. According to his statement, the cash was double-counted and awarded to both businesses by FTX’s internal audit system.
Following SBF’s announcement, FTX and Alameda Research had the most cash flow, while Binance, a competitor, became the most expensive. He spent a total of $2.5 billion to acquire Binance’s interests. Bankman-Fried also admitted to spending $250 million on real estate and $1.5 billion on other costs.
Some $4 billion and $1.5 billion were invested in venture capital to buy other enterprises, respectively, while $1 billion was miscounted.
According to the report, Bankman-Fried and the remaining staff spent the previous weekend trying to gather finances. The cash will be used to close an $8 billion shortfall in FTX’s balance sheet and reimburse consumers.
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