Obituaries

FTX Was Worth $32 Billion in January and Bankrupt by November

Customer deposits were supposed to sit untouched at the exchange. Instead they went on a field trip to a hedge fund next door.

Photo by Arturo Añez / Unsplash

FTX built its reputation on being the responsible crypto exchange — the one with the boyish, disheveled billionaire founder who testified before Congress about regulation and gave interviews about effective altruism. By January 2022 it was valued at $32 billion. By November, it was bankrupt, and its customers were missing an estimated $8 billion.

The mechanism was almost old-fashioned: customer deposits that were supposed to stay at FTX were quietly funneled to Alameda Research, a trading firm run by the same founder, Sam Bankman-Fried, and used to cover Alameda's own bad bets, buy real estate, and fund political donations. The collapse itself, once it started, took ten days — November 2 to November 12, 2022 — to go from "liquidity concerns" to full bankruptcy filing.

Bankman-Fried gave a widely watched interview shortly after, in which he described the situation as having gotten "a little cocky." He was arrested in the Bahamas in December 2022, convicted in November 2023 on seven counts including wire fraud and conspiracy, and sentenced in March 2024 to 25 years in prison. An appeals court rejected his bid to overturn the conviction in 2026.

The part that made it land differently than a normal financial collapse was the marketing: FTX had spent heavily positioning itself as the trustworthy adult in a famously untrustworthy industry. It turned out to be untrustworthy in the most traditional way possible — someone was just quietly moving the customers' money.

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Apeel's Grape Seed Coating Once Kept Six in Ten American Supermarket Avocados From Spoiling. Then the Internet Found the Safety Data Sheet for a British Degreaser Also Called Apeel.

A Texas Power Company Charged $9.99 a Month to Let Customers Pay Exactly What the Wholesale Market Paid. In February 2021 the Market Paid $9,000 a Megawatt-Hour, and Griddy Drafted It Straight From Their Accounts.

Australia Paid Up to $1,600 a Home in 2009 to Insulate a Million Ceilings in a Year, Using Installers Who Signed Up Online. Its First Industry Meeting Heard New Zealand Had Tried This and Three People Electrocuted Themselves.

Subway Told Australian Customers Its Footlong Was a Trademark Name, Not a Measurement of Length. The US Trademark Board Ruled It Was a Measurement of Length and Refused Subway the Trademark.