In a statement this week, the former CEO of FTX has expressed his willingness to testify to Congress
Original source and article: ABC News
In a tweet Friday, the former CEO of the failed cryptocurrency exchange FTX said he was willing to testify before Congress next week, but that he wouldn’t be as helpful as he would have liked.
It was in response to Maxine Waters’ tweets earlier this month requesting that Sam Bankman-Fried attend next week’s hearings regarding the collapse of FTX.
A series of tweets from California Democratic Rep. Maxine Waters to Bankman-Fried said that the information you have so far is sufficient for testimony based on multiple media interviews since FTX collapsed.
As a result of growing doubts about the financial strength of FTX and its affiliated trading arm, Alameda Research, customers tried to withdraw their assets all at once last month. According to FTX’s new management, FTX’s management was “completely ineffective” after its collapse.
It has been acknowledged that Bankman-Fried was at fault for the collapse.
FTX’s U.S. business solvency, its American customers, as well as possible solutions for returning assets to international clients are among the concerns he listed in a series of tweets to Waters. Furthermore, he said he could discuss “my own failings” and what he believes led to the crash.
According to Bankman-Fried, he takes responsibility for FTX’s collapse and didn’t understand the extent of the risk being taken by Bermuda-based FTX and Alameda across both operations. Alameda is accused of using customer assets in FTX to place large bets in the market on Bankman-Fried’s behalf. Public interviews have revealed that Bankman-Fried didn’t co-mingle customers’ assets with Alameda knowingly.
It is the responsibility of exchanges like FTX to keep customers’ deposits separate from their bets on the markets. About ten years ago, MF Global got in trouble for misusing customer deposits.
As recently as a week ago, Bankman-Fried said he believed one of FTX’s U.S. affiliates was fully solvent and could begin processing withdrawals immediately. He said the fate of customers’ funds in FTX’s other divisions, which were significantly bigger than the U.S. division, was largely beyond his control.
In the aftermath of FTX’s failure, Bankman-Fried says he is living on a single credit card and likely has less than $100,000 to his name.
A subpoena is “definitely on the table” if Bankman-Fried is unwilling to testify about the collapse of FTX, Waters said on Tuesday.