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Sam Bankman-Fried is the co-founder and ex-CEO of FTX, a cryptocurrency derivatives exchange. He also co-founded Alameda Research, a quantitative crypto trading firm. Both ventures were wildly successful, with FTX regularly ranking in the top 5 crypto exchanges by volume, before FTX and all its affiliate companies declared Chapter 11 bankruptcy in November 2022.
Who is Sam Bankman-Fried?

Bankman-Fried (also known by his initials, SBF) famously became one of the richest people in crypto before the age of 30. In October 2022, his net worth was valued at around $16 billion, mostly comprising his ownership in FTX and a share of FTT tokens, the native cryptocurrency of the FTX exchange.

He was a passionate supporter of effective altruism, a utilitarian movement that uses evidence and reason to determine how to benefit others as much as possible and taking action on that basis. For example, he is outspoken about his mission to make as much money as possible in order to eventually give it all away, a philosophy called “earning to give.” He was also famous for donating  millions to charitable and political causes with pledges for subsequent giving.

In four years, Bankman-Fried went from being relatively unknown to a crypto billionaire. His meteoric rise in the crypto world, tremendous self-made wealth, and philanthropic mission makes him one of the most talked about and influential players in the crypto ecosystem.

His rise ended abruptly in November 2022 when questions started arising as to the legitimacy of the assets on FTX and Alameda’s balance sheet. Overnight, SBF saw his net worth plummet as he went from crypto darling to crypto villain.

Personal history

Bankman-Fried was born in 1992 in California to two law professors at Stanford Law School. Both of his parents subscribe to the philosophy of utilitarianism - that actions are right if they are useful or for the benefit of a majority. This moral philosophical upbringing set the foundation for Bankman-Fried’s later philanthropy.

Growing up, Bankman-Fried hated school, finding it boring and overly structured. He attended the Canada/USA Mathcamp over summers in high school, which provided the intellectual challenge he needed. He attended the Massachusetts Institute of Technology (MIT) and graduated in 2014, earning a degree in physics and a minor in mathematics. He remains dismissive of formal education, noting that nothing he learned in school ended up being useful in his professional life.

In his sophomore year of college, Bankman-Fried attended a talk by Will MacAskill, a founder of effective altruism. Bankman-Fried considers this introduction a turning point in his life, embodying his long-held beliefs with a name and a movement.

In college, Bankman-Fried interned at Jane Street Capital, a Wall Street trading firm, trading international ETFs. He returned there full-time after college, giving more than half of his earnings to charity.

Role in cryptocurrency community

In September 2017, he quit Jane Street Capital and briefly worked as the director of development at the Center for Effective Altruism in Berkeley, CA while toying with the idea of setting up his own cryptocurrency trading firm. He knew little about crypto at the time but recognized its enormous potential. “There was huge demand, huge volatility, huge inflows, huge price appreciation, huge amounts of attention and interest—and the infrastructure wasn't there,” he told Yahoo.

Launch of Alameda Research

In late 2017, bitcoin was trading about 30% higher in Korea and 10% higher in Tokyo compared to the US. Demand for crypto was massive in those countries but international trading laws made selling foreign-held bitcoin difficult. That November, Bankman-Fried and his college fraternity brother, Gary Wang, created Alameda Research, a firm that developed a prototype for a crypto trading platform.

Alameda first focused on profiting from the Japanese bitcoin premium using a strategy called arbitrage trading. This strategy exploits the price differences between identical assets in different markets by buying at a lower price from one exchange and selling it higher at another. They made about $20 million in the first few months, and the company continues to be successful as a principal trading firm.

As of 2021, Bankman-Fried owned approximately 90% of Alameda Research.

Launch of FTX

Over the next two years, Bankman-Fried and Wang became frustrated with the offshore exchanges they were trading on, noticing lack of costumer safety nets, poor infrastructure, and bad management. At the time, offshore crypto exchanges had none of the safeguards of traditional financial markets. For example, if a customer’s account became negative, the exchange would likely recuperate the losses from other customers, even though those customers were collateralized.

Bankman-Fried and Wang were inspired to start their own crypto exchange platform with more trading options and better security. FTX registered in Antigua and Barbuda in April 2019, then launched in Hong Kong the next month. FTX stands for “Fu-Tures eXchange.” “I’m not good at naming things,” Bankman-Fried has said.

One area FTX pioneered was in streamlining market collateral – traders could now hold all their margin in one wallet as collateral, instead of having to manage multiple wallets for different assets. FTX also continually added products to their offerings, including crypto derivatives, options, tokenized stocks, prediction markets, leveraged tokens, OTC, and pre-IPO tokenized stocks.

The exchange was enormously successful. A year after launch, the company was valued at over $1 billion dollars, and $32 billion three years later. As of early 2022, the exchange handled over one million users.


In November 2022, SBF found himself in the middle of a controversy that started when Alameda Research’s balance sheet was leaked to the media, raising questions about how intricately connected the firm was with FTX. Specifically, the article revealed that Alameda Research, a key market maker for FTX, held more than a third of its balance sheet in FTT token, FTX’s native token.

The issue was exacerbated when Binance’s CEO, Changpeng “CZ” Zhao, sold a large amount of FTT token days after these revelations came to light, driving the price of FTT down precipitously, leading to a liquidity crunch for FTX.

Intermingling of assets between FTX and Alameda Research was widely speculated to be the driver of the series of events which resulted in FTX being unable to support customer withdrawals, and as a result disabling user access to their funds.

On November 11th, FTX filed for Chapter 11 bankruptcy.

Wealth, effective altruism, and political donations

Bankman-Fried signed the Giving Pledge in June 2022, a public commitment by the world’s richest people to give away most of their wealth to philanthropy. As of 2022, he estimates that he has given between $50 and $100 million to organizations supporting animal causes, global poverty, climate change, biosecurity, and pandemic preparedness.

Bankman-Fried is also known for his high-profile political donations. In 2020, he donated $5.2 million to two super political action committees (PACS) supporting the Biden campaign, becoming one of the president’s top donors.

In spring 2022, he controversially announced that he would spend up to $1 billion to influence the 2024 presidential election, later walking back on the claim. He donated $40 million to political action committees and campaigns of Democratic candidates in the run up to the 2022 mid-term elections.

Sam Bankman-Fried essentials

  • Sam Bankman-Fried is a co-founder of FTX, a top cryptocurrency exchange, and Alameda Research, a crypto trading platform.
  • Bankman-Fried was one of the richest people in crypto and fastest-rising stars before FTX and all its affiliate companies declared Chapter 11 bankruptcy in November 2022.

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