Bankman-Fried's Assets Plummet to Zero in Days

The co-founder of FTX, Sam Bankman-Fried, has seen his entire fortune of $16 billion wiped out, one of the biggest destructions of wealth in history.

The crypto exchange and trading house owned by the mogul once likened to John Pierpont Morgan have become worthless. At the peak, the 30-year-old was worth $26 billion, and he was still worth almost $16 billion at the start of the week.

The Bloomberg Billionaires Index has revised the value of FTX's US business downward to $1 billion, due to the potential for a trading halt. This is a significant drop from the $8 billion valuation the company received in a January fundraising round. Additionally, Bankman-Fried's stake in Robinhood Markets Inc., which was valued at more than $500 million, has been removed from his wealth calculation. This is because Reuters has reported that the stake is held through Alameda and may have been used as collateral for loans.

This week, Bankman-Fried's empire crumbled after a liquidity crunch at one of its affiliates. FTX.US, its US exchange, said on Thursday that customers should close out any positions they want to and that trading may be halted in a few days. In the Bahamas, where FTX.com is based, authorities froze the assets of its local trading subsidiary and related parties.

Bankman-Fried is being investigated by the US Securities and Exchange Commission for potential violations of securities rules, a person familiar with the matter said.

Sam Bankman-Fried, the CEO of FTX, lost billions of dollars in just a few days. This is a huge loss for him and his company.

FTX.com is facing a liquidity shortfall of as much as $8 billion, and CEO Sam Bankman-Fried has been trying to raise new funding to rescue his business. He’s in talks to raise $9.4 billion from investors including Justin Sun, crypto exchange OKX and a group of funds, Reuters reported. FTX said it reached an agreement with Sun’s Tron that will allow users to withdraw some tokens from the troubled exchange.

At the same time, some FTX.US employees are seeking to sell parts of the business, in some cases without Bankman-Fried’s participation, people familiar with the matter said.