Nov 30, 2022 - Economy

Sam Bankman-Fried on what was real, what was "corporate bullshit"

Illustration of a person in a suit holding an umbrella made of money

Illustration: Sarah Grillo/Axios

Sam Bankman-Fried admits in an interview with Axios that FTX's multitude of licenses were "corporate bullshit," but swears his effective altruism quest was genuine.

Why it matters: Regulators, lawyers, creditors and prosecutors are digging through the rubble of bankrupt FTX trying to determine whether Bankman-Fried was lying or just in over his head.

Background: The FTX founder and former CEO crafted an image as a rumpled, slightly mad wunderkind, napping on office beanbags and wearing shorts to meetings.

  • Bankman-Fried's most defining feature, however, was his dedication to effective altruism (EA). His main goal, he has said, was to make money and to give it away.
  • But that image fell into the blender in a recent Twitter DM conversation with Vox reporter Kelsey Piper, in which Bankman-Fried threw cold water on the virtue of being ethical.

What he's saying: In an Axios interview Monday night, Bankman-Fried acknowledged that part of his image was curated, but maintains that effective altruism was his driving force — even if the EA movement would prefer to disown him.

  • "The thing that was bullshit was not EA," said Bankman-Fried. "EA, I happen to care about deeply. I believe in blockchain and crypto. Those things are absolutely real."
  • His predilection for playing games in important meetings — most notably while trying to get Sequoia to invest millions into FTX — was also not a front, he says: "It helps me...clear my mind. It helps me keep my mind focused on what I'm doing."

Yes, but: Some things were bogus. For example, Bankman-Fried says FTX went too far with some of the licenses it acquired —licenses that created the image of being a highly regulated exchange.

  • "I think we probably went a little bit overboard on the number of licenses that we got," he says. "There were ones that we did that weren't ultimately meaningful. It was trying to brand yourself in a way that you wanted to be seen."
  • Notably, FTX spent some $2 billion on "acquisitions for regulatory purposes," according to documents seen by Reuters.

Of note: Bankman-Fried acknowledges that he has harmed the EA movement, having served as its most public face.

  • "I was hoping all the projects I would be able to fund would have a massive positive impact on the world. Now it looks like that might not end up happening," he said.
  • The implosion of FTX has opened EA up to criticisms that its comfort with taking big risks played a role in FTX recent blowup.

Bottom line: Bankman-Fried appears to be trying to create a new image, one where he's seen as transparent and unceasingly apologetic — as a founder who genuinely cared about his customers, but was incompetent rather than one who had intentionally committed fraud.

Go deeper: Sam Bankman-Fried says he's down to $100,000

Go deeper