Sam Bankman-Fried reveals the circumstances behind Bahamian withdrawals

The former FTX CEO has explained why the exchange only reopened withdrawals for Bahamian citizens shortly before filing for bankruptcy.

FTX’s former CEO Sam Bankman-Fried has divulged what really went on in the days before it filed for bankruptcy when the exchange selectively reopened withdrawals — only for Bahamian users. 

In a telephone interview with crypto blogger Tiffany Fong, dated Nov. 16, Bankman-Fried claims to have made the decision to reopen withdrawals to Bahamian citizens as he did not want himself, nor the exchange, to be in a country “with a lot of angry people in it.”

“The reason I did it was it was critical to the exchange being able to have a future because that’s where I am right now, and you do not want to be in a country with a lot of angry people in it and you do not want your company to be incorporated in a country with a lot of angry people in it,” he said.

Bankman-Fried claims he gave Bahamian securities regulators a “one-day heads up” that FTX was going to do it, but said the regulator neither responded with a “yes or no,” before he ultimately decided to go ahead with allowing withdrawals.

“So it was realistically speaking, it’s shitty, but […] the pathway for FTX involved Bahamians not being pissed at it.”

The now-defunct crypto exchange initially halted all withdrawals on Nov. 8 as a result of liquidity issues.

On Nov. 10, only a day before it filed for bankruptcy, the exchange noted it had begun to facilitate withdrawals of Bahamian funds. At the time, it claimed that it was in compliance with the demands of the country’s regulators — leading to millions of dollars worth of funds extracted from the exchange.

However, the Securities Commission of The Bahamas (SCB) threw a wrench into FTX’s narrative, stating on Nov. 12 that it had neither instructed nor authorized FTX to prioritize withdrawals of Bahamian clients.

They also warned that any withdrawal of funds could be clawed back as part of the firm’s liquidation proceedings.

Cointelegraph contacted the SCB for confirmation on if it had received communication from FTX prior to the exchange’s withdrawals reopening, and what its response was at the time. The SCB did not immediately respond.

Audio from my first interview with Sam Bankman-Fried. SBF talks bankruptcy, the alleged “backdoor,” donations to the Democratic Party, Ukraine money laundering rumors, the hack, Alameda’s margin position on FTX, using FTT as collateral & more. https://t.co/qVfUv6dhww

— Tiffany Fong (@TiffanyFong_) November 29, 2022

In his most recent interview with Fong, Bankman-Fried denied the move was to facilitate withdrawals by people within FTX after Fong suggested that this is how it was being seen.

“Oh it wasn’t insider withdrawals, this was trying to create a regulatory pathway forward for the exchange.”

SBF was hot on FTX hacker’s trail

The former FTX CEO also noted during the Nov. 16 interview that he was close to finding out the identity of the FTX hacker, who is understood to have stolen over $450 million worth of assets soon after the exchange filed for bankruptcy on Nov. 11.

“I don’t know exactly who because they shut off all access to the systems when I was halfway through exploring it. I’ve narrowed it down to eight people. I don’t know which one it was but I have a pretty decent sense.”

Bankman-Fried said he believes it was “either an ex-employee or somewhere someone installed malware on an ex-employee’s computer.”

Related: ‘I never opened the code for FTX’: SBF has long, candid talk with vlogger

In a separate, more recent interview with Sam Bankman-Fried by Axios on Nov. 29, the former FTX CEO has revealed he only has around $100,000 left in his bank account as of today.

This is despite Bankman-Fried being worth an estimated $26 billion at his peak.

Bankman-Fried claims that he had “basically everything” tied up in the now-bankrupt company.

“I mean, I have no idea. I don’t know. I had $100,000 in my bank account last I checked,” he said.