The Mystery Unraveled: Who Stole Money from FTX and Who Is the King of Cryptocurrency?
As the trial of the self-proclaimed “King of Crypto,” Sam Bankman-Fried, looms on the horizon with multiple fraud charges, the story of one British man’s devastating loss sheds light on the collapse of FTX, Bankman-Fried’s cryptocurrency empire.
Sunil Kavuri, until recently, held out hope that Sam Bankman-Fried could rescue the crumbling kingdom. With years of experience in trading for banks and investing in cryptocurrencies, Kavuri had developed a resilience to market turbulence. Moreover, Bankman-Fried, the man who had assumed the mantle of crypto’s savior, repeatedly assured the world that all would be well.
However, hope turned to despair when a message flashed across Kavuri’s computer screen – “withdrawals suspended.” In November of the previous year, FTX, once the world’s second-largest cryptocurrency exchange, filed for bankruptcy, marking the beginning of Kavuri’s financial nightmare.
Years of astute, high-pressure trading, and successful investments evaporated in an instant. Kavuri’s $2.1 million (£1.7 million) nest egg vanished into thin air. “I was on the computer for basically 24 hours refreshing the page and trying to email the FTX support desk to get my money out. I felt sick. I just thought, ‘Oh my God, that’s it. I’ve lost everything,'” Kavuri recounted.
A resident of Derbyshire, Kavuri had earmarked the funds for a new house and to finance his son’s university education. Yet, nearly a year later, all that remains is the paper trail of what used to be his life savings.
Kavuri is believed to be among the worst-affected British victims of the FTX collapse, a platform that had been marketed as a secure gateway for crypto enthusiasts worldwide. FTX functioned like an unregulated bank, facilitating currency-to-crypto trades, including Bitcoin, and providing safe storage for users’ assets.
With its enticing promises, FTX attracted nine million customers spanning 100 countries. However, when the exchange fell apart, over a million users found themselves unable to retrieve their investments in time. Court documents revealed a broad spectrum of victims, including businesses, investors, and even charitable organizations, all left reeling from substantial losses.
The upcoming high-profile trial in the United States will see Sam Bankman-Fried facing seven charges, including fraud, conspiracy, and money laundering. Bankman-Fried maintains his innocence, stating, “I didn’t steal funds, and I didn’t stash billions away.”
The 31-year-old entrepreneur, founder of FTX and the crypto hedge fund Alameda Research, has pleaded not guilty. He will leave prison temporarily to appear in a New York courtroom to defend himself against these grave allegations. Meanwhile, other executives from his companies have already pleaded guilty and are expected to provide insights into the downfall of an empire once valued at $40 billion.
At the heart of the accusations is the claim that Bankman-Fried misappropriated customer funds to support his high-risk investments within his hedge fund. These allegations include lavish expenditures on luxury properties and political contributions, casting a shadow over the meteoric rise and sudden collapse of the FTX platform.