The CEO of cryptocurrency exchange FTX, Sam Bankman-Fried (SBF), has been standing out as a true savior of crypto companies in the crypto market.
The 30-year-old billionaire philanthropist has been helping industry companies like BlockFi and Voyager Digital, for example, that are struggling financially. And, according to him, this financial aid can continue.
In an interview with Reuters published on Wednesday (6), SBF said it still has “a few billion” in cash to support struggling crypto organizations and contain an even bigger crisis in the ecosystem. However, he believes the worst is over.
FTX bails out crypto companies
The collapse of the Terra ecosystem (LUNA) in May resulted in a ripple effect in the crypto market, “contaminating” several companies in the sector.
One of the most impacted was Three Arrows Capital, which has invested heavily in LUNA in the past. In the domino effect, cryptocurrency exchange Voyager Digital (VOYG) and crypto lending platform BlockFi also suffered heavy losses.
To BlockFi, FTX has secured a $250 million emergency line of credit. Also, last week, FTX announced a performance-based purchase agreement with BlockFi.
Meanwhile, another Bankman-Fried company, Alameda Research, “saved” Voyager with a $200 million revolving line of credit and an additional 15,000 Bitcoins.
FTX has also tried to bail out Celsius, which has stalled users’ withdrawals after financial difficulties. However, SBF backed out of the deal after reviewing the company’s finances. Sources said the company had a $2 billion “hole” on its balance sheet and FTX found it difficult to deal with.
Recently, SBF said that their ultimate goal with these actions is to protect customers and the crypto market:
“You know, we’re willing to do a pretty bad deal here if it’s necessary to stabilize things and protect the customers.”
According to SBF, trust with customers that things will work as advertised is incredibly important and, if broken, is incredibly difficult to regain.
The FTX CEO told Reuters that his company still has enough cash to close a $2 billion deal if necessary.
“If all that mattered was a single event, we could get above a few billion,” he said.
However, SBF emphasized that, in some cases, the ransom money comes out of its own pocket and not from FTX.
“FTX has shareholders and we have a duty to do reasonable things for them. I certainly feel more comfortable burning my own money,” he said.
Finally, regarding the widespread fall in cryptocurrencies, the so-called “crypto winter”, SBF said that prices may have already bottomed out. But he acknowledged that the fall was worse than expected:
“I don’t think it’s an existential threat to the industry, but I think it’s a little worse than I would have anticipated,” Bankman-Fried said.