VC's Cryptocrush

Everyone loved him. With shaggy hair, a rapid voice, and an awkward grin, Sam Bankman-Fried (or SBF) was the “it guy” of the crypto bull run. His quirks had VCs blindly writing blank checks ($1.8B worth, to be exact)…

Sleeps on a beanbag? Oh so dedicated.

Lives with 9 co-workers? They’re on a mission.

Only wears one shirt? No time to waste on appearance.

On paper, SBF was a prodigy. He was an MIT physicist turned Wall Street quant trader. Whatever that means.

In 2019, shy of his 30th birthday, he launched FTX — a crypto exchange. Within months, they processed $14.7B of daily trades, hit a $32B valuation, and lured a herd of investors who did not care for due diligence.  

SBF then grew a personal $26B fortune and was crowned crypto king.

How did he do it? Uh, let’s rewind to his pitch deck…

The Pitch Deck

By 2021, FTX was on fire. Profits skyrocketed 100x to $800M annually. FTX was all the rage. Tom Brady, Steph Curry, and the Miami Heat arena became synonymous with the brand. Even Jim Cramer was all in (abort, abort).

FTX was a “one stop shop” for (un)sophisticated crypto traders. Spot markets, derivatives, options, volatility products, and of course plenty of leverage. Just the right mix to have hopeful gamblers daydreaming on Zillow.

They had over 5M active users, none of which were still in their parent’s basement.

Their compliance framework slide is perhaps the icing on the FTX scam cake. This was, well… entirely made up 💀. 

Lastly, here’s the beloved team. Unfortunately, they had other ideas for where investors’ money should go…

More Volatile Than Crypto Itself

• May 2019: Sam Bankman-Fried Founds FTX

• August 2020: FTX Acquires Blockfolio; Valued at $18B 

• January 2021: FTX Peaks, Becoming the 3rd Largest Crypto Exchange

• January 2022: FTX Raises $400M at a $32B Valuation

• June 2022: Rumors Spread of FTX’s Insolvency

• August 2022: FDIC Probes FTX; SBF Buys Zhao's Binance Stake

• September 2022: FTX Moves HQ to the Bahamas; FTX President Brett Harrison Resigns (good call)

• October 2022: Texas Investigates FTX for Unregistered Securities 

• November 2022: FTX Files for Bankruptcy 

• November 2022: Sam Bankman-Fried Resigns as CEO  

• December 2022: SBF Arrested

• November 2023: SBF Found Guilty, Faces Up to 110 years in Prison

SBF’s Personal Piggy Bank 

SBF treated FTX like a personal slush fund. Private jets, celebrity poker games, Bohemian real estate, he had it all.

When a leaked balance sheet exposed their crushing debts, FTX experienced a “bank run” as panicked users rushed to withdraw funds. SBF desperately tried finding a buyer before filing for bankruptcy. Audits later revealed an $8B hole in FTX’s balance sheet. 

In late 2022, SBF was criminally charged with fraud and money laundering. He faces over 100 years in prison when sentenced in March 2024. The one-time crypto darling is now an orange-jumpsuited convict doing his best impression of Zero from Holes.  

The epic rise and fall of FTX is a cautionary tale (and soon to be movie starring Jonah Hill) — the tech may be innovative, but human greed isn’t.

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