Sam Bankman-Fried Discusses Collapse of FTX: Live Updates

Credit…Hiroko Masuike/The New York Times

The FTX founder Sam Bankman-Fried said on Wednesday that his parents “bore no responsibility” for the downfall of his crypto exchange and the trading arm, Alameda Research, which he founded.

“Anyone close to me, including my parents and employees and co-workers who fought with the company to push forward, they were hurt by this,” Mr. Bankman-Fried said. “They bore no responsibility for that. I feel really bad about that. I feel really grateful for the support my parents are still giving me throughout all of this.”

Both of Mr. Bankman-Fried’s parents are Stanford Law School professors, who Mr. Bankman-Fried has said were influential in shaping his ethical framework. Their vocations also helped lend Mr. Bankman, 30, a further veneer of credibility with investors and others as he built his cryptocurrency empire.

Mr. Bankman-Fried was asked by Andrew Ross Sorkin at the DealBook Summit what he told his parents when his firm began to collapse this month. FTX was forced to file for bankruptcy after an avalanche of customer withdrawals created an $8 billion hole on the firm’s balance sheet. Mr. Bankman-Fried likened the customer exodus to a run on the bank.

“I think I called them up and said, ‘Hey guys, I think there might be a problem, like, it looks like Alameda’s position might be imploding here — there might be a liquidity issue,’ he said.

When asked about the $300 million worth of real estate that FTX and Mr. Bankman-Fried’s parents reportedly bought in the Bahamas—including a $121 million house—he said he did not “know the details but that it was not intended to be their long -term property.”

“They may have stayed there while working with the company sometime over the last year,” he said of his parents.

As for other immediate personal fallout from the implosion of FTX, Mr. Bankman-Fried said he thought he had one working credit card and $100,000 left in the bank.

“I don’t have any hidden funds here,” he said.

Mr. Bankman-Fried also painted FTX as having a tame work culture, brushing aside a question from Mr. Sorkin about FTX staffers’ alleged drug use. “There were no wild parties. At our parties, we play board games. Twenty percent of people would have a quarter of a beer each, and the rest of us would not drink anything.”

Mr. Bankman-Fried said he had been prescribed “various things” to help with concentration.

“I think they help me focus a little bit,” he said. “I had been a lot more focused over the last year.”

And to the question of whether he lied to customers, investors and regulators: “I was as truthful as I’m knowledgeable to be,” he said.

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