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FTX Was an Empty Black Box All Along

Sam Bankman-Fried made crypto charming—and only now is the frightening scope of this fiasco becoming clear for everyday investors.


Photo illustration: 731; Photographer: Lam Yik/Bloomberg

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The epic unraveling of cryptocurrency exchange has delivered many shocks: The $8 billion in liabilities it couldn’t pay, its huge exposure to its own magic-bean digital tokens, the apparent misuse of customer funds and the mysterious unauthorized withdrawal that drained off a chunk of the money that remained. Even so, it could have been a lot worse: Founder Sam Bankman-Fried had been trying to expand beyond crypto enthusiasts to capture the assets of everyday savers and investors in stocks and funds. The music stopped before he could get there.