iexclusivenews understands that according to a Nov. 22 letter obtained by Cointelegraph, Bankman-Fried explained to staff the causes of FTX’s liquidity problem and consequent insolvency.
He mainly verified the facts released by media sources in the aftermath of the exchange’s demise, noting the crypto market fall as one of the causes contributing to a decrease in the value of FTX’s collateral assets. According to the former CEO, November’s “run on the bank” helped lower the exchange’s collateral to around $9 billion, with $8 billion in liabilities.
“I never intended this to happen,” said SBF. “I did not realize the full extent of the margin position, nor did I realize the magnitude of the risk posed by a hyper-correlated crash.”
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Bankman-Fried blamed his part in the disaster on a lack of control, stating he should have been “more cautious of huge margin positions” and implemented additional systems to monitor and simulate bank failures and runs. He stated that he intended to “make it up” to impacted team members, although he appeared to regret the actions that led to FTX’s bankruptcy:
“I believe that a month earlier FTX had been a thriving, profitable, and innovative business. which means that FTX still had value, and that value could have gone towards helping to make everyone more whole. We likely could have raised significant funding; potential interest in billions of dollars of funding came in roughly eight minutes after I signed the Chapter 11 docs.”
“Maybe there still is a chance to save the company,” said SBF. “I believe that there are billions of dollars of genuine interest from new investors that could go toward making customers whole.” But I can’t promise you that anything will happen, because it’s not my choice. ”
SBF resigned as CEO of FTX on November 11, the same day the FTX Group filed for bankruptcy in the United States. Although bankruptcy procedures in the District of Delaware are still underway, the legal team representing FTX debtors stated on November 22 that the exchange’s assets were still vulnerable to hackers. An unknown someone stole 228,523 Ether. (ETH
$1,159) from FTX on Nov. 11.
