‘not a good strategic move on my part’

‘not a good strategic move on my part’

Changpeng Zhao and Sam Bankman-Fried.Horacio Villalobos/CorbisAlex Wong/Getty Images

  • Sam Bankman-Fried regrets the feud that may have helped cause the collapse of his crypto empire.

  • The relationship between Bankman-Fried and Binance CEO Changpeng Zhao soured when Bankman-Fried pushed for crypto regulation.

  • “It was not a good strategic move on my part,” Bankman-Fried told the New York Times in an interview.

Sam Bankman-Fried regrets the feud that may have cost him his crypto empire.

The former FTX CEO said criticizing Binance CEO Changpeng Zhao, known as “CZ,” “was not a good strategic move on my part,” in an interview with the New York Times on Sunday.

The clash between the two is key to understanding one of the most dramatic collapses ever in the crypto world.

How it started

Zhao and Bankman-Fried started friendly: Binance, a rival cryptocurrency exchange, invested in FTX in 2019. However, the relationship soured when Bankman-Fried pushed for regulation of the crypto industry, something Zhao opposes.

The New York Times reported that Bankman-Fried used his growing influence in Washington to criticize Zhao in private meetings.

“I was pretty frustrated at a lot of what I saw happening, but I should’ve understood that it was not a good decision of me to express that,” Bankman-Fried told the New York Times.

The dispute between the two billionaires came to a head early last week when Zhao announced that Binance would sell all of its FTT holdings, a cryptocurrency created by FTX.

“We gave support before, but we won’t pretend to make love after divorce…we won’t support people who lobby against other industry players behind their backs,” Zhao tweeted.

The outcome

Binance’s sale spooked the market, causing investors to flood FTX with requests to pull their funds, causing a multi-billion dollar liquidity crisis.

Binance initially agreed to buy FTX to save it from a dire financial situation but later called off the deal.

“I shouldn’t throw stones in a glass house, so I’ll hold back a bit,” Bankman-Fried told employees, according to The Times. “Except to say: probably they never really planned to go through with the deal.”

FTX unsuccessfully attempted to find other investors, eventually filing for bankruptcy on Friday. One week earlier, the cryptocurrency exchange was worth $32 billion.

Bankman-Fried faces multiple investigations and allegations that he misused FTX customer funds by reportedly funneling them into a separate entity, his crypto trading fund, Alameda Research.

Read the original article on Business Insider

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