FTX founder arrested in the Bahamas

Sam Bankman-Fried, founder and chief executive officer of FTX Cryptocurrency Derivatives Exchange, was arrested in the Bahamas. The authorities of the Bahamas acted after the U.S. Attorney for the Southern District of New York shared a sealed indictment.

“His arrest followed receipt of formal notification from the United States that it has filed criminal charges against SBF and is likely to request his extradition,” said the Bahamas government. “Bahamian authorities arrested Samuel Bankman-Fried at the request of the U.S. Government, based on a sealed indictment filed by the SDNY. We expect to move to unseal the indictment in the morning and will have more to say at that time,” read a Twitter posting of the U.S. Attorney for the Southern District of New York.

Bankman-Fried’s arrest was carried out one month after the FTX filed for bankruptcy protection with the U.S. Supreme Court. Bankman-Fried, who had led FTX whose value had reached 32 billion dollars (around 42 trillion won) as of November 11, will be prisoned.

He is accused of using client funds deposited in FTX in his crypto trading firm, Alameda Research. He also owes 3.1 billion dollars (around 4 trillion won) to 50 top creditors. “Customer assets from FTX were commingled with assets from Alameda,” read a written statement by John Ray, the new CEO of FTX, to Congress ahead of the hearing, acknowledging that accusations against Bankman-Fried are correct.


Hyoun-Soo Kim kimhs@donga.com