The boss of the giant crypto exchange Coinbase has accused mainstream media outlets of being too soft in their coverage of disgraced FTX founder Sam Bankman-Fried, even as billions in customer funds remain missing.
Coinbase CEO Brian Armstrong blasted the treatment Bankman-Fried has received during an ongoing media apology tour that has included widely scrutinized interviews with the New York Times, Bloomberg, ABC’s “Good Morning America” and various other outlets.
Armstrong also called out Rep. Maxine Waters (D-Calif.) for tweeting that the House Financial Services Committee would “welcome” Bankman-Fried’s “participation” in a hearing on FTX’s downfall next week.
“It’s been pretty bizarre to kind of watch the whole thing unfold, primarily because I do feel like mainstream media has given a lot of softball interviews, and even this tweet back and forth with Maxine Waters very politely asking him to attend a hearing, and him politely deferring, it was bizarre,” Armstrong said during an interview with tech newsletter Stratechery published on Thursday.
“I mean, this guy just committed a $10 billion fraud, and why is he getting treated with kid gloves?” Armstrong added. “Compare her tweets about Mark Zuckerberg for instance, who never stole $10 billion from people, whatever you think about the guy.”
The feds are probing the actions of Bankman-Fried and other FTX executives prior to the company’s downfall last month.
FTX was forced to declare bankruptcy on Nov. 11 after a facing a sudden liquidity crunch exposed an $8 billion shortfall in its balance sheet. Bankman-Fried claims to have simply “misaccounted” those funds.
Reuters reported that Bankman-Fried secretly shifted $10 billion in FTX customer funds to cover risky bets at Alameda Research, the cryptocurrency trading firm he also owned.
Armstrong asserted that Bankman-Fried and his close associates at FTX should face jail time over their actions ahead of the bankruptcy.
“The bankruptcy lawyers, and the DOJ, and everybody are going to have to figure out how to hopefully put these folks behind bars,” Armstrong said. “Not just Sam, but the other people involved. I mostly want to think about where do we go from here as an industry.”
In several interviews, Bankman-Fried has insisted he is ignorant about any potential wrongdoing at FTX while simultaneously seeking to distance himself from the events that led to the bankruptcy.
In his appearance at the New York Times’ DealBook summit, Bankman-Fried attempted to dodge blame by saying he “didn’t ever try to commit fraud.”
At the same time, Bankman-Fried has lawyered up, hiring Mark S. Cohen, a defense attorney best known for representing convicted sex offender and Jeffrey Epstein companion Ghislaine Maxwell.
Federal prosecutors in New York are reportedly investigating whether Bankman-Fried engaged in market manipulation that prompted the collapse of the interlinked cryptocurrencies Luna and TerraUSD earlier this year – and eventually led to the implosion of FTX.
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