Out of nowhere, 30-year-old Sam Bankman-Fried became a billionaire mover and shaker in the world of cryptocurrency. Careful to make friends of powerful Democrats and media columnists alike, he threw money around the halls of Congress — and everywhere else he went — while threatening to disrupt Chicago’s financial futures industry. Known by his initials, “SBF” is a billionaire no more. The house of cards he built over the past several years came crashing down in a matter of days. His FTX crypto exchange and the entangled Alameda Research hedge fund are now in bankruptcy, amid reports that customer funds are missing. As many as a million of SBF’s customers may have lost whatever they had in their trading accounts, which, unlike traditional bank and brokerage accounts, are not guaranteed by the federal government against a company’s failure. Media reports are drawing comparisons to the fall of Enron Corp. or the Bernie Madoff Ponzi scheme. Everyone from police in the Bahamas to U.S. Sen. Dick Durbin, D-Ill., is demanding answers from SBF, who sent a series of tweets saying, among other things, he wants to make his customers whole.
Full opinion : Cryptocurrency needs regulation to spare customers from collapse.
