Coinbase CEO on ‘Stolen Customer Money’ Used by SBF’s Alameda Research


On Saturday (3 December 2022), Coinbase Co-Founder and CEO commented on the interview that Sam Bankerman-Fried (aka “SBF”), the disgraced co-founder of Alameda Research and co-founder and former CEO of bankrupt crypto exchange FTX, gave to Bloomberg recently at $30 million his Bahamian penthouse apartment.

The following video from Wall Street Journal nicely summarizes how FTX went bankrupt:

According to a report by New York Post published on Friday (2 December 2022), during the interview, when the Bloomberg reporter pointed out that FTX, which filed for Chapter 11 bankruptcy in the U.S. on 11 November 2022, had $8 billion less in liquid assets than SBF had claimed, SBF who graduated in 2014 with a bachelor’s degree in physics and a minor in mathematics, said that he had “misaccounted.”

Well, yesterday (3 December 2022), the Coinbase CEO posted a pair of tweets that suggested that he was not impressed with this explanation:

According to a report by the Daily Hodl, here is what Armstrong said about FTX during an appearance on an episode of the “All-In Podcast” released on 13 November 2022:

They had this solvency issue and instead of just letting it blow up, Sam basically said, ‘Hey we have a bunch of customer assets over here at FTX’ or he somehow basically made a loan from FTX into Alameda trying to prop it up. I don’t know why he did that. That’s the moment in my mind where he crossed the line into probably committing fraud. I think he probably lied to users, lied to investors and he went around and tried to bail out these different companies like Voyager and BlockFi to sort of come off of this thing and maybe he thought he could trade his way out of it...

I do think there is a some contagion risk here. I think there’s other firms that had money just sitting in FTX, and that’s now going through bankruptcy court. So that’s been bad. Multicoin [Capital] came out publicly and said that they had 10% of their portfolio sorted on FTX. There’s other firms that Alameda may have had loans with, and those firms are probably struggling.

I don’t want to say who, but we’ve received a couple of inbound calls from other people trying to get emergency financing. There’s people who may have just – totally different from FTX and Alameda – they may have just had their own portfolio that they took margin or leverage on to buy crypto and now that prices have come down a little bit, they’re getting stopped out, so that’s all been very challenging.

On Thursday (1 December 2022), former hedge fund manager Jim Cramer made it very clear how he feels about SBF.

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Cramer is the host of CNBC show “Mad Money w/ Jim Cramer“. He is also a co-anchor of CNBC’s “Squawk on the Street“, as well as a co-founder of financial news website TheStreet.




As you may remember, on Wednesday (30 November 2022), the New York Times held its annual DealBook Summit in New York City, an an event which was hosted by Andrew Ross Sorkin, Times columnist and DealBook founder and editor at large.

Of course, the interviewee that most people were most excited about hearing from was Sam Bankerman-Fried (aka “SBF”), the disgraced co-founder and former CEO of bankrupt crypto exchange FTX.

Based on the full transcript of Andrew Ross Sorkin’s interview with SBF published by CoinDesk earlier today, SBF said:

Clearly, I made a lot of mistakes or things I would give anything to be able to do over again. I didn’t ever try to commit fraud on anyone… I didn’t knowingly commingle funds. And again, one piece of this you have the margin trading you have you know, customers borrowing from each other, Alameda is one of those. I was frankly surprised by how big Alameda’s position was, which points to another failure of oversight on my part. And a failure to appoint someone to be chiefly in charge of that. But I wasn’t trying to commingle funds…

The time that I really knew there was a problem was Nov. 6. Nov. 6 was the date that the tweet about FTT came out. By late on Nov. 6, we were putting together all of the data, putting together all the information that obviously should have been put together way earlier, that obviously should have been part of the dashboards I was always looking at…

We were spending an enormous amount of our energy on compliance. We’re spending an enormous amount of energy on regulation on licensure. We’re getting licensed in dozens of jurisdictions…

Everything I have, I’m disclosing and you know, I’m down to…I have one working credit card left. I think it might be $100,000 or something like that in that bank account. And, I mean, everything that I had, even all the loans I had were, you know, those are all things I was reinvesting in the businesses…I put everything I had into FTX.

The next day, Sorkin asked his CNBC colleague Cramer what he thought about SBF’s comments at the DealBook Summit interview and Federal Reserve Chair Jerome Powell’s comments about the U.S. economy at the Brookings Institution.

Cramer replied:

One’s just a total con artist, disgusting, makes me sick. The other guy did a good job. I thought he told a good story… I think that Sam whatever – I don’t even want to dignify his full name anymore – is just a con artist, as many of the people who talk about crypto believe coming on the show.



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