Sam Bankman-Fried said on Twitter that FTX was the 'darling of Silicon Valley,' but the firm got 'overconfident and careless'
- Sam Bankman-Fried attempted to explain what went wrong at FTX in a series of tweets.
- He said he was lauded as a "darling of Silicon Valley," but FTX got "overconfident and careless."
Sam Bankman-Fried said he was lauded as a "darling of Silicon Valley" and "on the cover of every magazine," but FTX got "overconfident and careless."
In a series of tweets, the founder and former CEO of crypto exchange FTX has attempted to explain what happened to cause the company's implosion.
"Problems were brewing. Larger than I realized," he wrote.
Last week, FTX declared bankruptcy, and Bankman-Fried stepped down as CEO after the exchange faced a liquidity crunch that prevented FTX from filling customer requests to withdraw money from their accounts. As a result, many customers may be left with nothing.
Bankman-Fried allegedly quietly used FTX customer funds to prop up a separate company of his, crypto trading Alameda Research. He now faces several investigations in the US and the Bahamas, where he had set up FTX's headquarters.
Bankman-Fried wrote on Twitter that he believed FTX's leverage was around $5 billion, but "I was wrong: leverage wasn't ~$5b, it was ~$13b."
"$13b leverage, total run on the bank, total collapse in asset value, all at once. Which is why you don't want that leverage," he added.
FTX's new CEO and chief restructuring officer, John Ray, released a statement via a series of tweets on Wednesday that said that Bankman-Fried no longer speaks for the company, though FTX's Twitter account quickly deleted that portion of the statement from Twitter.
Bankman-Fried told the New York Times on Sunday that he's making up the thread of tweets as he goes.
"I don't know... I'm improvising. I think it's time," he said.