By Jared Tilley | Senior Investment Analyst at NAOS Asset Management
FTX collapse with Coinbase CEO Brian Armstrong + election results, macro update & more
In August 2022 Sam Bankman-Fried, who is widely known as SBF, was dubbed the next Warren Buffett by Fortune (LINK) but fast forward a few months, the 30-year-old tech wiz from Stanford California is behind one of cryptos biggest collapses.
FTX, which was one the world’s largest cryptocurrency exchange platforms and at one point estimated to be worth US$32bn, filed for bankruptcy on November 11th. FTX’s Chapter 11 filing follows a run-on customer deposit and a failed last-minute attempt to secure a bailout from Binance (another cryptocurrency exchange platform). FTX claims to have up to 100,000 creditors with claims in the case, which could include large Private Equity Funds and famous sports stars.
The rumour mill has been in overdrive the last week, with a focus on how much was lost and whether the collapse of FTX can be compared to Lehman Brothers (which collapsed due to being overleveraged) or Enron (collapsed due to corporate fraud). At one point Mr Bankman-Fried whereabouts became a huge focus as it was rumoured that he had fled FTX’s headquarters in Bahamas on a private jet for Argentina (LINK).
While everyone is still trying to unpack what took place, Mr Bankman-Fried seems to be in the same boat because on November 14th, via nine individual tweets, he posted “What HAPPENED”. But the good news is, Michael Lewis, the bestselling author behind The Big Short and Flash Boys, has found himself in the right place at the right time as he has spent the last six months traveling with Mr Bankman-Field (LINK) and even though one word of the story is yet to be written for his newest book, his agency is currently looking at selling the rights for a movie.
The story is still unfolding but to get up to speed with the collapse, listed below are a few useful sources.
Watch the All-In Podcast interview with Brian Armstrong, CEO of Coinbase, to get his views on the recent collapse. The discussion on FTX starts at 20:47.
Link to Podcast
FTX’s Leaked Balance Sheet
A few articles worth reading
An interesting ad featuring Larry David, which was shown during Super Bowl LVI
Mr Bankman-Fried’s apartment
View more NAOS Podcasts and Book reviews
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