It’s been a bone-chilling crypto winter (crypto! famously MLMs for white men and celebrities who get high on exploitative business endeavors), as prices have plummeted to embarrassing depths. Now, Sam Bankman-Fried, the 30-year-old founder of flailing crypto exchange FTX and “disgraced boy king of crypto,” is feeling the extent of that chill after he was arrested in the Bahamas on Monday on fraud charges.
On Tuesday morning, SEC Chair Gary Gensler said in a statement that Bankman-Fried used FTX customer funds to fund his own “lavish” lifestyle, make political donations, and bail out his own trading arm Alameda Research—an entity that was “supposedly” separate from FTX, according to Coindesk. In layman’s terms, investors—mostly everyday crypto traders—trusted FTX with their funds only to find they could not withdraw their money, because it had been diverted elsewhere to serve Bankman-Fried’s agenda. Court documents filed by the SEC maintain Bankman-Fried was “orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform’s customer funds for his own personal benefit and to help grow his crypto empire.”
“We allege that Sam Bankman-Fried built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto,” Gensler said in the release. Bankman-Fried says he did not “knowingly commingle” consumer funds, but has not issued an updated comment. I must also note that the word “knowingly” is deadlifting a significant amount of weight in this statement. Maybe he accidentally commingled consumer funds. Maybe he clumsily commingled them. Maybe he did it while blindfolded!!!
As with any over-confident, swindling white boy with unmitigated access to billions of consumer dollars, the tale of Bankman-Fried (SBF, for short) and his swift downfall is full of eccentricities. For one, Bankman-Fried is somewhat of a pseudointellectual nepo baby: SBF is the son of two Stanford professors. His father, in particular, is a clinical psychologist, a law professor at Stanford Law School, and “a leading scholar in the field of tax law,” according to his SLS biography. Daddy is reportedly in the Bahamas supporting SBF at the moment, although he doesn’t appear to have supported FTX’s bookkeeping given that the multi-billion dollar organization was using Quickbooks to track their expenditures. Quickbooks…the one used by small nonprofits, holiday gift shops, and one-person shows.
Much like disgraced WeWork founder and fraudster Adam Neumann, SBF also played a shrewd game of image manipulation, concocting a younger millennial iteration of the Mark Zuckerburg boy genius archetype. SBF was often spotted in plain cotton t-shirts and unbrushed hair, and exuded an “unmade bed” demeanor. He wore shorts to meetings, was said to frequently nap on office beanbags for all to see, and appeared fixated on being perceived as the personification of “I woke up like this.” For this reason, I shall call him the Toddler Fraudster. The Fraud-ler. (I will keep workshopping this one.)
I won’t harp on men who get the privilege of dressing like unkempt tweens, because I believe whole-heartedly that we should be able to labor while wearing whatever makes us most comfortable. But it’s the strange manipulation of the man-baby image for financial gain that gives me the ick: Investors, politicians, and celebrities (looking at you, the couple formerly known as Mr. and Mrs. Bündchen) were enticed to work with the boy-wonder because of his boyishness, while over-qualified POC women and femmes are waving their hands screaming “YOO HOO, what about us?” for their own fundraising rounds.
SBF has apologized in a manic Twitter thread that harkens on the emotional intensity of the original Zola thread without any of the ingenuity. In it, he says he is sorry in a variety of ways 16 different times, including “I’m sorry,” “I fucked up,” “should have done better,” “it’s on me,” “I fucked up twice,” “I was off twice,” “I was shit at [things],” and “I sincerely apologize.” This roundabout Twitter apology tour has the sincerity of a serial cheater thirty seconds away from telling you the dog walker accidentally tripped onto his dick on the way over to your house.
The ideological appeal of crypto was founded on the promise of financial equality—that anyone, regardless of class, demographic, or location, should have access to the trading rat race and reap its benefits. But if SBF has shown us anything, it’s that under-experienced privileged white boys are never going to fully satisfy the savior complex cycling through their own heads. You thought SBF of all people was going to solve financial inequality? The guy who saw the ice storm coming, glanced at the shivering temperatures, and decided it was an opportune time to lick the frozen lamp post? Think again.