FTX founder Sam Bankman-Fried plans to testify before Congress
The former CEO of the failed cryptocurrency exchange FTX said in a tweet Friday that he is willing to testify to Congress next week, but that he will be limited in what he can say and that he "won't be as helpful" as he'd like to be.
The tweet came in response to several tweets earlier this month from House Financial Services Committee Chair Maxine Waters, who had requested that Sam Bankman-Fried attend next week's hearings over the collapse of FTX.
Waters, a California Democrat, said in a series of tweets to Bankman-Fried that based on multiple media interviews since FTX collapsed, it was "clear to us that the information you have thus far is sufficient for testimony."
The onetime crypto wunderkind spoke with The New York Times at a Dealbook event on Nov. 30. A live audience sat quietly as Bankman-Fried, speaking via video from his home in the Bahamas, stumbled through the causes of FTX's meltdown.
FTX failed last month in what was essentially a cryptocurrency version of a bank run. Users withdrew about $5 billion worth of crypto assets in a single day amid rising concerns about FTX's solvency. Since its collapse, FTX's new management has called the cryptocurrency exchange's management a "complete failure of corporate controls."
In tweets responding to Waters, Bankman-Fried listed specific issues he would be able to discuss with the committee, including the solvency of FTX's U.S. business, its American customers and possible solutions for returning assets to international clients. He also said he could talk about what he thinks led to the crash and "my own failings."
Bankman-Fried has said that he takes responsibility for FTX's collapse and that he failed to grasp the amount of risk Bermuda-based FTX and Alameda Research, the trading arm of FTX, were taking on across both businesses. Bankman-Fried has said in public interviews that he did not "knowingly" co-mingle customers' assets with Alameda.
Bankman-Fried's name was listed as a defendant in a class-action lawsuit filed Friday, accusing him and several celebrities of deceptive marketing. It marks the third class-action suit customers have filed against celebrities who promoted FTX Trading. Tom Brady and Larry David are among those accused of defrauding investors in FTX's collapse.
According to the lawsuit, celebrities touted FTX "in order to induce confidence and to drive consumers to invest in what was ultimately a Ponzi scheme, misleading customers and prospective customers with the false impression that any cryptocurrency assets held on the deceptive FTX platform were safe and were not being invested in unregistered securities."
Bankman-Fried has said he believes the U.S. affiliate of FTX is entirely solvent and could start processing withdrawals at once. As for the rest of FTX, which was significantly larger than the U.S. division, he said the fate of customers' funds was largely out of his control.
Waters has said FTX's collapse had "harmed over one million people," and had threatened to subpoena the 30-year-old if he was not willing to testify. "A subpoena is definitely on the table," she tweeted on Tuesday.
