FTX’s wild start to the week, explained

And it all started with some “Storybook Brawl.”

On Monday, FTX founder Sam Bankman-Fried admitted to playing the game “Storybook Brawl” while he was being interviewed on a widely attended Twitter Space from his home in the Bahamas.

FTX’s wild start to the week, explained

“I hope you’re not playing video games tomorrow when you’re trying to dissuade Congress from seeing you as a fraud,” one interviewer quipped.

Bankman-Fried wouldn’t have to worry about that. Hours later, on Monday evening, he was arrested based on charges in a sealed indictment filed by the US Attorney’s office.

On Tuesday morning…

Prosecutors unsealed their indictment, which charges Bankman-Fried with eight counts of fraud and conspiracy.

  • Charges on the 14-page document span from money laundering, to misuse of customer deposits, to conspiracy to defraud the US, to campaign finance violations.

As he awaits extradition to the US, Bankman-Fried — whose net worth peaked around $26B in March and has since been wiped out — could spend time in Fox Hill, the Bahamas’ notoriously unsanitary prison.

Oh, and what ended up happening in DC?

Back in Washington, it was made clear that despite the alleged fraud’s massive scale, its complexity wasn’t all that sophisticated.

At one point, newly appointed CEO John Ray, who previously worked through Enron’s infamous bankruptcy, explained to lawmakers that FTX leaders used Slack and QuickBooks to handle the company’s finances.

“Nothing against QuickBooks — very nice tool — just not for a multibillion-dollar company,” he said.

On Tuesday evening, Bankman-Fried was denied bail. He’ll have an extradition hearing Feb. 8.

Topics: Cryptocurrency

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