FTX CEO Sam Bankman-Fried says his crypto rescues have had mixed results – here’s why
The CEO of the FTX cryptocurrency exchange says that so far the company’s rescue efforts within the industry have achieved mediocre results.
In an interview with Bloomberg, FTX CEO Sam Bankman-Fried tells host David Rubenstein that not all of his firm’s efforts to prop up ailing crypto companies have been profitable, including money spent on troubled crypto broker Voyager Digital.
“Mixed, basically, is the answer. I think some will turn out to be profitable, some won’t. With Voyager, it’s $70 million that we’re putting in, and I’m not sure we’ll ever see [it] again.
We had to make quick judgments, and we made them so that if things went well, they would be good investments. If they performed poorly, they would be bad investments, but we kind of limited the amount we could lose on that.”
When asked how FTX came up with the funds to provide the loans, the billionaire says,
There were a few different versions of it. One chip was just the FTX balance. We keep the company’s cash in dollars, and we’ve raised several billion dollars over the last couple of years. We are a profitable company.
We had also made some acquisitions, which partly balances it out, but we had some money left. And with the BlockFi deal, for example, I think it was on FTX.US’s balance sheet.”
Back in early summer, the BlockFi lending platform reached an agreement with FTX.US for a $400 million revolving credit facility, plus an option for FTX to acquire BlockFi at a variable price of up to $240 million.
The CEO further explains what motivated FTX to help crypto companies that were in need,
“I think it’s something I felt was right for the industry. Our very explicit mandate that we gave to the team of people working on this was: ‘Your goal in this is not to make a fortune. Your goal is to make good deals [and] lest we have our faces torn off.’
But depending on it [was also to] do as much as we can to save the industry. The higher objective was to try to stop places rather than maximize these deals.”
Earlier this year, FTX spent hundreds of millions of dollars backing crypto businesses.
Bankman-Fried told Decrypt’s GM Podcast almost a month ago that he was disappointed by the lack of response from other major players in the crypto space to step up to help rescue struggling companies.
“On all of these kinds of bailouts that we’ve tried, we reached out to everyone we could to help us…
Our perception has been that, to a disappointing degree, there have not been that many who have actually been game to pitch in.
We will do it if no one else will. We think it’s the right thing to do.”
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Featured Image: Shutterstock/Salamahin/Brian A Jackson
