The founder of bust cryptocurrency exchange FTX has claimed he puffed up his ethical credentials as part of a “dumb game we woke Westerners play” to burnish his reputation “so everyone likes us”.
Sam Bankman-Fried, the 30-year-old founder of collapsed cryptocurrency company FTX, admitted in an interview that his public stance on ethical issues was in part a “front”.
The admission comes amid accusations that Mr Bankman-Fried scammed investors out of their money. Regulators around the world, including the US Department of Justice, are investigating the collapse of FTX, which has left over one million creditors out of pocket.
Mr Bankman-Fried, who at one stage was worth around $16bn, was a self-proclaimed “effective altruist”, meaning he aimed to make as much money as possible in order to give it away to charities.
He appeared in multiple videos explaining his views on climate change and world poverty and posted his thoughts on how to maximise his positive impact on the world on Twitter.
However, he told the website Vox: “Man all the dumb s*** I said… it’s not true really.”
On Twitter on Thursday morning, he added: “Some of what I said was thoughtless or overly strong I was venting and not intending that to be public.
He added: “What matters is what you do–is actually doing good or bad, not just talking about doing good or using ESG language.”
Crypto investors on Twitter have compared the collapse of FTX to Bernie Madoff, the American financier who ran the biggest Ponzi scheme scam in history worth over $60bn.
FTX, which was based out of a luxury Bahamas penthouse, filed for bankruptcy protection in the US with $9bn in liabilities and just $900m in liquid assets last week. The huge black hole in its accounts emerged after a surge in withdrawals it could no longer meet.
Despite the controversy surrounding him, Mr Bankman-Fried has spoken to American media and shared his thoughts on Twitter since the collapse.
He refused to comment on the prospect of prison time in an interview with the New York Times.
FTX was a digital coin exchange where people could buy and sell digital assets such as Bitcoin. It fell into bankruptcy protection last week along with a web of more than 130 companies, leaving as many as one million people out of pocket.
The company has been accused of misusing billions of pounds in customer deposits to FTX and secretly transferring them to a hedge fund, called Alameda Research, to make high risk investments.
Mr Bankman-Fried appeared to accept that he used customer funds to make questionable trades in his interview with Vox.
“It was never the intention,” he said, “sometimes life creeps up on you.”
He claimed: “Each step in isolation was rational and reasonable, and then when I finally added it all up last week it wasn’t.”
He also said he was still attempting to raise up to $8bn to rescue the failed cryptocurrency exchange.
John Jay Ray, a bankruptcy expert who has been installed as chief executive of FTX, distanced the company from its founder.
Mr Ray, who led Enron through its restructuring in 2001, said: “Mr Bankman-Fried has no ongoing role at FTX, FTX US, or Alameda Research Ltd and does not speak on their behalf.”
At one stage valued at $32bn, FTX and Mr Bankman-Fried had tried to woo politicians and regulators and had sponsored a bill in Washington DC to improve cryptocurrency regulation.
Mr Bankman-Fried attempts to court regulators were mostly “just PR” before saying “f*** regulators”.