: Sam Bankman-Fried’s philanthropic fund halts donations amid FTX collapse and ‘questions about legitimacy’

by | Nov 11, 2022 | Stock Market

Sam Bankman-Fried once promised to give away most of his fortune to help humanity, but now some of the people who benefited from that generous pledge are wondering if they may have to give the money back. After peaking at an estimated $26.5 billion, Bankman-Fried’s fortune appears to be evaporating with the collapse of FTX, the crypto exchange he founded and where most of his wealth was tied up. FTX has filed for Chapter 11 bankruptcy and is now under investigation by the U.S. Department of Justice and Securities and Exchange Commission after a run on the exchange zapped roughly $6.8 billion from user accounts.

The company said Friday that Bankman-Fried had resigned as CEO and would be replaced by John J. Ray III, a lawyer who worked on Enron’s bankruptcy. One major piece of collateral damage in the debacle: the philanthropic entities that Bankman-Fried started to improve humanity’s chances for long-term survival, among other lofty goals. The senior staff of Bankman-Fried’s philanthropic FTX Future Fund publicly quit Thursday night, saying that the fund could no longer operate or process grants, and that they “have fundamental questions about the legitimacy and integrity of the business operations that were funding the FTX Foundation and the Future Fund.” The group added, “We are devastated to say that it looks likely that there are many committed grants that the Future Fund will be unable to honor.” The charitable operation’s abrupt end is a remarkable turn for Bankman-Fried, who has consistently promoted the idea that he and his company were both giving back to humanity as he rose to prominence in the crypto world. Bankman-Fried, now 30, has said he decided when he was 20 that he wanted to “earn to give,” meaning he would try to make as much money as possible so he could give it all away to charity. He also said that he built giving into FTX’s business model, with 1% of all net fees reportedly donated to the “world’s most e …

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