It is no longer news that Sam Bankman-Fried, the Forbes-rated “crypto genius” once ranked five places higher than Aliko Dangote on the Bloomberg Billionaire Index, has lost all his wealth.
Also known as SBF, the 30-year-old American crypto entrepreneur once had a personal net worth estimated at $16 billion while his crypto exchange FTX peaked at $32 billion in the previous year.
Known as “King of Crypto”, “Crypto’s White Knight” and other sobriquets, SBF at the height of his powers regaled adulating followers with long interviews about his incredible rise from his office in the Bahamas.
As the second largest crypto exchange in the world behind Binance, FTX had an NBA stadium named after it and endorsements from top celebrities, including NFL’s Tom Brady.
But within eight days, he fell from near invincibility to the subject of a federal investigation.
SBF abandoned his role as CEO on November 11 after his company declared bankruptcy. FTX had an estimated 1.2 million registered users, including Nigerians, who were using the exchange to buy cryptocurrency tokens such as Bitcoin and numerous others.
One of its largest investors, Sequoia Capital, recently announced it was writing off a whooping $210 million invested in FTX as a loss.
Before his business came crashing, SBF was the second-largest donor to the Democratic Party after George Soros and one of the most prominent crypto-linked personalities with a foothold in Washington.
SBF had pledged to donate $1 billion to political candidates linked to his favourite causes, although he later reneged on this pledge.
He reportedly donated $40,000 to Democratic Party candidates and causes in the recent US midterm election.
Political lobbyist, Bradley Beychok said SBF “came on the scene out of nowhere [and] became a large supporter of different causes and candidates very quickly”, Financial Times reported.
Another Democratic Party lobbyist was quoted as saying that “Sam didn’t live up to his commitments” and his promises more “bluster than action”.
The crypto entrepreneur had told the BBC in October that he had given “a few hundred million as of now” to charity, a claim that is being doubted in some quarters.
SBF’s influence also extended into Europe, and he was a vocal supporter of Ukraine, which he partnered with months ago to launch a new crypto donation website.
Tech billionaires, Elon Musk and Mark Cuban have in the past ripped into the disgraced crypto entrepreneur.
Fortune reported how Musk in September turned down an offer of $15 billion from SBF’s adviser during his search for investors for his $44 billion takeover of Twitter.
Musk reportedly doubted SBF’s financial standing.
As reported by CoinBase, the Tesla CEO explained his reasons during a Twitter Space.
“To be honest, I’d never heard of him. But then I got a ton of people telling me [that] he’s got, you know, huge amounts of money that he wants to invest in the Twitter deal. And I talked to him for about half an hour. And I know my bullshit meter was redlining. It was like, this dude is bullshit—that was my impression.
“Then I was like, man, everyone including major investment banks— everyone was talking about him like he’s walking on water and has a zillion dollars. And that [was] not my impression…that dude is just—there’s something wrong, and he does not have capital, and he will not come through. That was my prediction.”
Cuban, a bigtime crypto investor and owner of Dallas Mavericks, called SBF “greedy”.
“First, you’ve got to understand crypto. There’s speculation—that’s all the noise. Then there’s things that have happened with [crypto platform] Voyager and with FTX now—that’s somebody running a company that’s just dumb as f*** greedy. So, what does Sam Bankman do? He just, give me more, give me more, give me more, so I’m gonna borrow money, loan it to my affiliated company, and hope and pretend to myself that the FTT tokens that are in there on my balance sheet are gonna sustain their value,” he said at a Sports Business Journal conference on Friday1.