Bitcoin Forum

SBF Begged Investors for $7 Billion FTX Rescue Package In Final Days

FTX founder Sam Bankman-Fried is ready to save his crypto exchange from catastrophe by begging global investment big guns including Sequoia Capital for $7 billion, having splurged $10 billion in customer funds to prop up his trading firm Alameda.

Although Bankman-Fried insisted FTX and Alameda were separate entities, investor presentations showed the same assets appearing on both simultaneously - enabled by an aide tweaking FTX accounting software to hide transfers of funds between them.

Financial records also showed over $400 million in “software royalty” payments made by FTX to Alameda that were used to buy up the platform’s FTT digital coin to reduce supply and bolster its value.

FTX's death was because SBF used user funds from FTX to transfer to Alameda, Alameda used that money for investment and mortgage lending, from that very reason led to the collapse of FTX. It makes me wonder if anyone will trust a man like SBF enough to support him and invest in him again. He is a really talented guy but with such a lack of transparency in his work, it is not worth trusting anymore and a debt of up to 8 billion is a very large number, this has caused Binance to refuse to buy back FTX because if they buy back FTX, it will also have to pay FTX's debt of 8 billion.

It's really difficult to gain trust after what happened with FTX Exchange now. Some investors already accepted the reality and started to move on.
But Sam Bankman-Fried seems still positive after all that happened, we still don't know what will happen in the future, they just filed Bankruptcy Chapter 11, and they told us that they will still cater to customers. As most affected here for me are those customers, retail customers, or small customers that used FTX Exchange for their live saving.

Talented is good but trusted is more important.

Trust itself is not easy to achieve and it takes a lot of time as well as efforts to gain it. However, to destroy your trust, it is more easily and can be done quickly. Sam Bankman-Fried and FTX are very good examples on how trust can fall to zero in a short time.

FTX is dead and in future, if Sam opens another company, another exchange, it is very difficult for him to raise fund and regain trust from cryptocurrency users.

In paper, go bankruptcy with Chapter 11 is not the end of FTX and customers likely won't lose all their capitals. But how much will they be compensated is still unknown and how FTX can come back is very vague.

This is another circus from SBF. Sequoia Capital is a very large investment company in the market that has been in business for over 50 years and they have made billions. Look at which companies he invested in before the advent of cryptocurrencies.They won't give money to a junkie in shorts with hairy legs :)

Again, it's SBF fault, he should have taken this very seriously, as he admitted that it was his own fault.

And then he is asking big investors to help him and salvage is FTX? for what assurance? his reputation has been damage and even if he says that he is willing to pay in the next 10 years, I doubt that huge investors are going to take his word as he has lost everything in this game.

The timing as well, the world is shambles, everyone is losing money right now so I doubt that they are investors willing to take that risk.

He's going to sell bonds to his new potential investors. I know that it could be hard for him but there will be people who likes betting and want to gamble with his company.

Maybe there could be friends of his friends that would still be willing to still trust him with their money.

But if he has done some things that shouldn't be done by a CEO to his company, he's likely to do it again.

I'm afraid there is no rescuing FTX/FTT, this was the same situation when terraform labs collapsed, there were quite a lot of talks of attempts at rescuing/resuscitating their collapsed ecosystem through LUNC/Terra Classic and the rest of them, but all of that was nonsense and doomed to fail which it did. Once you've lost customer/community trust, i am afraid there is no way to regain it, and Sam Bankman-Fried already lost every atom of faith and trust people in the crypto network have for him, remember that they didn't only go insolvent, but they were also hacked, no responsible business is going to put their money in a bid to rescue the dead exchange. SBF may try all he likes, but it is definitely going to be fruitless, and i can see him facing legal charges sooner rather than later, just like Do Kwon.

It must be a shame for him. I personally think that if his attitude has been reflecting the true SBF. I meant he bet for investors to help him but he doesn't even care about the money got hacked a few days ago from FTX global. that being said that if this scenario already prepared by him.
He may securing remaining amounts of money and called that as a hacking incident. He was writing all of scenario for sure. SBF must be jailed as he was the true evil in the crypto. I do believe if there will be a relationship with the hacked case that happened a few days ago.

If investors gave him that big amounts of money to help FTX and im sure that he will be sending it again to the caroline. Called FTX and alameda was separated but both were having very close connection.

Any token invested by alamda listed on FTX instantly. What a joke from SBF. That guy was a clown.

I don't think that begging will be enough from SBF to be able to salvage his FTX, he has caused a lot of money from investors, so I highly doubt that anyone is willing to lend him a hand right now.

It's his own wrong doings, he mismanage everything, he didn't have the money to begin with, all is running on fractional reserves and so when withdrawals happens, those who left their money behind can't withdraw and the messed started. For me it's time for SBF to be not delusional, but man enough to face the consequences of his actions.

Investors have lost their trust in SBF because of their own blunders, while begging for this they are not sure that there will be a help to save FTX, and chapter 11 has been filed, meaning that bankruptcy will still be felt by FTX and all customers will feel disappointed because their funds may be withheld, but That's how the trial will be decided.
I also don't believe in it It's all a mess at first they really believed in it and now they hate it.

The stench of absolute desperation. He is going to get what he deserves, hopefully a long jail sentence for ruining so many peoples lives. What him & his accomplices did is unforgivable, so many people trusted him & he betrayed them.

I know it’s dumb to store your wealth on exchanges for too long but that’s no excuse. He committee one of the biggest acts of fraud documented in modern financial history.

Throw him in jail & throw away the keys, his ugly gf & the others too.

Alameda did already, they will lend SBF a huge $1B and this is a good play for them after SBF investing to Alameda, it looks like this move is already planned before. Not sure about this but if FTX will come back, this is a good opportunity for everyone who lose their money to get away and take their money. FTX should compensate all the loses, what ever manipulation they are doing right now, I know it wont last and the truth will always prevail.

No one in theor right mind would bail Sam out on this one.  Sam is NOT a smart business man.  Who would have "loaned" Alemdea that money in the first place and at what point is ethics not talked about.  This is still the wild west I love it lol.  And honestly why do people use exchanges like a wallet service for him to even have access to that kind of dough.  Shame on people for not learning.  This WILL happen again.

SBF being talented is now in question.  He may be not be financially literate but he should have appointed someone who has the talent to run a financial organization.  Though I agree being trust worthy person is way better than being talented.  


It takes some time for the client to know the truth behind the activity of SBF.  CZ was ready to take over the FTX since he trust that there are no irregularities that are happening in the exchange but when they look in depth of the exchange, they discovered all the mismanagement that made the exchange bankrupt, the reason why they back off at the last minute.

I do not really understand what happened, I mean I get it, it’s said that there was some hack or something but come on, it can't be hacked for 7 billion dollars, there is something bigger going on in here.

For an exchange, people deposit their money into the exchange, you just hold it, and the more they trade the more of their deposit they give to you as profit, from the trading fee. That means even if there was a hacking, it can't be that big, how would people withdraw it from your accounts, and even if they do, at some point you will stop them or move the money out. So, it doesn't make sense on HOW they lost this much money, they must have done something stupid for sure.

Definitely, there are big players controlling SBF with regards to this. It seems that he has a lot of connections and probably he will not face jail time at any moment. Alameda just approve the loan of SBF worth $1B, if that company still trust SBF or this is just a return of favor, we’ll find out. SBF should pay the damages, I don’t believe on those hacking incidents, something is going on with their system and SBF knows that.

seems that SBF also wanted to save his face from all this drama. but in my opinion, SBF may have the chance to revive his platform. comparing it to DK of Luna, this one, i believe is hopeless. SBF is a known personality in crypto industry, and it seems that he wants to redeem himself on his latest move.
 we will see in the coming days how he can make this strategy works. can he get out of this situation and at least prove one more time that he has the capability to manage this business.

Well we bail banks out all the time and they wouldn't be able to pay either if we panicked and withdrawed our money. I totally understand that he wanted people to lend him money. Current financial system is based on everyone lending huge amounts to each other and claim they have money they actually don't have. I just listened to CZ interview about FTX and he was assuring that binance doesn't have loans and they are doing fine. I think i am trusting him at least when he is going to prove that.

After all things bad happen to FTX provably SBF cannot gain trust to big investors anymore because they will get a doubt on his management also with his credibility. Its clear right now that FTX is totally done and SBF is just finding ways to save his ass for the anger of people who still have balance on his platform. They really get a huge mess here and I believe alameda and ftx is controlled by same entity.

It may have been a good marketing for any company or individual to salvage the people who lost a lot of money but it's just too late for SBF and his "beloved" FTX or Alameda. Nobody wants to touch a company that was poorly managed and facing a lot of legal battles both from regulators and disgruntled investors. It's not worth the risk.

True, I think this plan of SBF to beg money to investors will not work out.  The exchange had already declared bankruptcy, I don't know why SBF still begged investors for fund.  Besides, I think no one will trust SBF anymore after all this FTX-Almeda fiasco.  And worst SBF may go to jail if he found guilty as charged.

One interesting fact from this case.

I watch "CZ" spoken on Bali, we all know "Binance" decide not to buy the company because financial research on FTX. Other fact about this case, CZ also say FTX requested a dumb offer to CZ.

Doesn't mean that binance rejected is not just because the research? now the company are not gonna get injection or buy from other investor/company.

Dude's just out of his mind thinking that after all of these chaos his companies caused, anyone would still trust him with money. He screwed up big time, and I don't think there's anything to save him from his fall unless another miracle in business happens to shot itself in front of him. He already used up his luck by propping up Alameda and FTX and even used deceptive tactics to make it work. Sadly for him, it's found out, called out, and destroyed by other people even before it goes so big that its failure would be much more devastating.

of course, they do need investor if the ftx really collapse the price of crypto will be heavily affected. and as far that i know the alameda research is kind like venture capital company that maybe they have asset that are still illiquid since token/coin not gonna launch after get seed funding right

In the past, some traditional businesses have filed for Chapter 11 bankruptcy but have since been able to reopen through negotiations with customers and support from new sponsors. Trump's businesses also filed for Chapter 11 bankruptcy a few times, but in the end they did not go bankrupt and reopened. But in the case of crypto companies, none of them have been able to resume operations yet so it is unlikely that FTX will be an exception. Whether the customer is compensated or not depends on the remaining assets of FTX, if it cannot be compensated, the investor will lose everything and cannot sue.

Indirectly, SBF offers its services which are already stained with sin. The same as investors must bear the sin which is only limited to the possibility that it can be cleaned as a whole. I think this is going to be difficult considering it will be a lifetime sin against the public, unless FTX actually changes ownership and changes the entire management structure especially removing the SBF name from the team line-up.

Regardless of the time or the field we are taking about trust is always going to be a key component in any business, SBF could have all the positive characteristics we may imagine but he has proven that he is not someone trustworthy, and as such no one is going to be willing to lend him any amount of money no matter how much he needs it, which is why I find ironic he was mad about binance making a move against him, when there is evidence that SBF has been trying to make moves against binance for years.

https://twitter.com/GRDecter/status/1593272102047580161
"I read the 30 page FTX Bankruptcy court filing.

How bad were FTX's internal controls?

Here are the worst examples 👇"

"1. Employees submitted expense reimbursements over chat

A random manager would accept or reject those reimbursements with an EMOJI"

"2. Related party loans:

Alameda Research (FTX's hedge fund) gave Sam Bankman-Fried a $1 billion personal loan

They also loaned Director of Engineering Nishad Singh $543 million"

\\
10.

There is still a lot of interesting things ahead.

Ok this is just insane. Imagine any other company in the world doing this. They would be crusified.  1 billion dollars in the most volatile markets out there. I wonder how that conversation went

Sam: "It would need to have a catastrophic event to mess with our markets and porfolio. We are doing just fine and we can afford some loans, no one will know, and luckily we chose FTT as collateral, that was soo smart"

Terra (Luna): "Hold my beer"

If I can have a word with the companies that might consider helping FTX and Sam again, I will tell them this .

Never trust a greedy man twice.

Using user's fund to gamble says it all, this is not a financial crisis for Christ's sake, this is mismanagement of funds that never belong to him.

This FTX bankruptcy is one of a kind, I don't understand why Sam hasn't been locked up in a cell already.

He played insane on Twitter after he ran off, hell no, I will never trust such a man ever.

Not only that, abusing authority to take billion of dollars of loan for personal company benefits.  They also trick their client and cheat on profit because they use Alameda to invest in different startups and companies.  The profit from that investment goes directly to SBF and those poor investors are just getting minimal interest from their investment.


There are powerful people behind SBF.  Don't forget he also uses his FTX clients' money to support political candidates.

Do you watch this news often? There are a lot of articles alleging binance is the cause of FTX's death and the person who should be investigated is binance and not FTX. It seems that SBF spent a lot of money buying those newspapers to write that he was a victim in the war between the two exchanges and did not mention it was his fault. While there is plenty of evidence accusing him of transferring money to Alameda, there is even a conspiracy theory that he transferred billions of dollars to Democrats and that it was investor money.
https://i.imgur.com/M97avAK.png

He may successfully escape jail term due to his political affiliations, but considering how this his story goes and has turned out were people finally have known the dirty habits and secrets of Sam, If you associate any name or identity with Sam as the owner, sponsor, or associate, people will never trust it. He has ruined his name, and name is a very important currency in the market.

I'm sure SBF won't get in trouble with the law in the US. For some people, he is a hero who gave 10 billion to his patrons, for others he is a scammer.

Read what the new manager of his exchange writes. A huge mass of violations, and the exchange has no chance to pay off creditors.

__

https://i.ibb.co/KxtL3NR/photo-2022-11-17-18-17-14.jpg (https://ibb.co/jkCW1VB)
Source: Bloomerg

Oh just like Epstein didn't get in any trouble? Just because someone is connected doesn't mean anything especially transactions are in public blockchain. If something, everyone want to wash their hands from the whole connection to sam. They won't be wanting to jeopardize political or otherwise public careers dealing with something as shady as this.

FTX is gone with SBF, I doubt investors will still trust SBF in any future deal, he didn't handle customers fund with integrity and when the saga started, he didn't show good leadership before a final collapse and this has badly affected the market.

A big fraud case would become trending even if it's not on crypto. It's just that FTX is just one of the biggest fraud ever and everybody want's to hear the news about it that's why it become a trend news in social media. It a big lesson for the victims not to store funds in a centralized exchange. This happened before and there's a chance that this case will be repeated. I've also experience losing some assets in a closed exchange and I learned my lessons there. This makes us realize how important non-custodial wallets is and why should we use it over the centralized exchange if we want to store our assets especially for a long time. 

He uses money that does not belong to him or his exchange without the consent of the users and he expects big institutions to trust him enough to release such a huge amount of money. What is the assurance he will manage people's funds the way they should this time?
I think it is going to be really tough for SBF to gain the trust of investors, enough for them to want to loan him such a huge sum.
Not only that, users will be very skeptical about the exchange assuming they manage to secure the loan and get things back up and running. I know I would be very afraid of using such exchanges until they are able to prove to be trusted again. If they ever will.

It is so simple.  SBF embezzled the FTX users funds.  He used it to support politicians, loan his firm Alameda Research and hide suspicious transfers to fund many investment of his own company.  The hacking incident is very suspicious probably it is one way to hide that FTX funds is already sucked dry.  Aside from that, another surprising is that the FTX has no Bitcoin holdings.  I wonder where are those BTC that FTX users have bought and keep in their exchange.