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FTX founder and former Chief Executive Sam Bankman-Fried said he expanded his business too fast and failed to notice signs of trouble at the exchange, whose downfall sent shock waves through the crypto industry, the New York Times reported late on Monday.
"Had I been a bit more concentrated on what I was doing, I would have been able to be more thorough," Bankman-Fried said in an interview with the newspaper.
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Michael Barr, the Fed’s vice-chair for supervision, cautioned ‘recent events in crypto ... have highlighted the risks associated with new asset classes when not accompanied by strong guardrails’FTX filed for bankruptcy on Friday, one of the highest-profile crypto blowups, after traders rushed to withdraw $6 billion from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal.
The US Justice Department, the Securities and Exchange Commission and the Commodity Futures Trading Commission are now all investigating how FTX handled customer funds, a source told Reuters.
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His comments come as crypto industry peers and partners outline steps to deal with the collapse of Sam Bankman-Fried's rival exchange, FTXBankman-Fried, who is based in the Bahamas, declined to comment on his current location, citing safety concerns, the newspaper said.
When asked whether FTX used customer funds to prop up the trading firm Alameda Research that he founded, Bankman-Fried told the New York Times that Alameda had accumulated a large "margin position" on FTX.
"It was substantially larger than I had thought it was," he said and added without providing details that the size of the position was in the billions.
Reuters reported last week that Bankman-Fried had secretly transferred $10 billion of customer funds from FTX to Alameda.
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