Former FTX CEO Sam Bankman-Fried has claimed to have “unknowingly mixed funds” between Alameda and FTX client funds.
Bankman-Fried spoke at the New York Times DealBook Summit via video conference on November 30, in which journalist Andrew Sorkin noted that “there seems to be a real mix of FTX client funds that shouldn’t be mixed.” with your company separately.”
Bankman-Fried denied knowledge of the commingled funds, chalking it up to poor supervision.
“I mixed funds without knowing it […] I was frankly surprised at how big Alameda’s position was, which points to another oversight failure on my part and my failure to appoint someone to primarily handle it,” Bankman-Fried said, adding:
“But I wasn’t trying to divert funds.”
Bankman-Fried also appeared to deflect blame for Alameda’s actions.
“I didn’t run Alameda, I didn’t know exactly what was going on. I didn’t know the size of his position.”
The cryptocurrency exchange imploded in early November as a result of a liquidity crisis, leading to halted customer withdrawals. He filed for bankruptcy days later, on November 11.
It is alleged that much of the liquidity crisis was due to Alameda using client funds to cover loans that were being withdrawn due to the credit crisis caused by the collapse of LUNA.
This is a developing story and more information will be added as it becomes available.
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