Sam Bankman-Fried, or SBF, known as the "cryptocurrency genius", was arrested on Monday (December 12) in the Bahamas at the request of the United States.&nbsp;Last month, he announced his resignation from FTX after facing a loss of 94 per cent of his net worth.&nbsp;&nbsp;

The "cryptogenius," also known as "modern JP Morgan"&nbsp;for his intervening to save volatile exchanges, has now been charged with&nbsp;defrauding investors in the company, by the United States&nbsp;Securities and Exchange Commission.&nbsp;The arrest was made on the eve of Bankman-Fried's scheduled appearance at a US Congress hearing. 
 
Who is SBF?&nbsp;

The&nbsp;30-year-old&nbsp;began his career as a trader at Jane Street and eventually amassed a crypto empire.&nbsp;SBF studied Physics at MIT, and after joining Jane Street, in 2017, he learned about cryptocurrencies and began using his expertise in the market. In his early days, he started by purchasing bitcoin in the US and used to sell them in Japan, a minimum price of at least 10 per cent due to price difference. &nbsp;

In&nbsp;2017, SBF established his own cryptocurrency trading firm 'Almeda Research,' which offers liquidity in exchange for digital assets and cryptocurrencies.&nbsp;Two years later, in 2019, he launched FTX, turning it to be one of the top exchanges for buying and selling cryptocurrency derivatives. Forbes estimates his exchange is worth $40 billion.

Watch |&nbsp;Binance walks away from FTX deal due to 'mishandled funds'

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Fried has designated himself as a 'selfless altruist,' who pledged to give the majority of his wealth to charity. Additionally, promised to provide billion-dollar support to US candidates to take precautions against pandemics. However, Cointelegraph reported that he till now has only donated only 0.1 per cent of his wealth.&nbsp;

Fried's exchange worth fell drastically by 94 per cent in a single day, as reported by the Bloomberg Billionaires Index. His net worth was nearly $15.5 billion prior to this announcement of the company's financial crisis. The worth dropped to $991.5 million back in November.&nbsp;

According to Fox News, the now-bankrupt founder of FTX, was also a&nbsp;generous supporter of Democratic candidates and liberal causes, contributing at least $38 million to left-wing organisations during the 2022 election cycle.

What happened to FTX? 
 
Concerns of liquidity issues in Alameda and FTX began in 2022.&nbsp;The cryptocurrency platform FTX has recently filed for Chapter 11 bankruptcy in the US, as per the statement released. &nbsp;

The drama in the world of digital currencies began after the largest cryptocurrency platform Binance said that it will sell its stock in the company, Binance eventually backed out of the agreement leaving the firm to acquire nearly $9.4 billion from investors. Investors sold FTT, FTX's tokens as a result.&nbsp;

ALSO READ |&nbsp;<a href="https://www.wionews.com/business-economy/cryptocurrency-lender-blockfi-files-for-bankruptcy-ftx-fallout-rattles-crypto-industry-538578">Cryptocurrency lender BlockFi files for bankruptcy; FTX fallout rattles crypto industry</a>

Notably, this crash left the finance world shocked after the company faced&nbsp;bankruptcy with panicked customers who began withdrawing billions from the platform.

According to&nbsp;Bankman-Fried,&nbsp;traders pulled $6 billion from the platform within three days while Binance, a rival exchange platform, declined to sign a rescue deal.&nbsp;

Two individuals familiar with the matter told Reuters that&nbsp;Bankman-Fried secretly transferred $10 billion in client money to affiliated trading firm Alameda Research, causing a liquidity crunch at the FTX. He has since told the news agency that did not move the money or run the research firm.&nbsp;

The FTX collapse and fallout

The fallout of this collapse was felt beyond the crypto world. A&nbsp;number of celebrities who endorsed his now-toxic exchange such as NFL quarterback Tom Brady and comedian Larry David were sued by the&nbsp;cryptocurrency investors who claimed they used misleading tactics to market FTX yield-bearing digital currency accounts.

ALSO WATCH |&nbsp;<a href="https://www.wionews.com/videos/trending-on-wion-former-ftx-founder-sam-bankman-fried-arrested-in-bahamas-542544">Trending on WION: Former FTX founder Sam Bankman-Fried arrested in Bahamas</a>

The class action lawsuit filed&nbsp;in Miami, last month also included&nbsp;Brazilian supermodel Gisele Bündchen,&nbsp;basketball legend Shaquille O'Neal, tennis star Naomi Osaka as well as The Golden State Warriors basketball franchise. Meanwhile, the collapsed crypto exchange by the end of November began a strategic evaluation of its worldwide assets and is putting some businesses up for sale or reorganisation.

Furthermore, with its 101 associated companies, FTX also requested judicial intervention to permit the functioning of a new worldwide cash management system and payment to its essential suppliers. Subsequently, crypto lender, BlockFi filed for bankruptcy citing the “significant exposure” to FTX which led to a liquidity crisis.&nbsp; 
 
Bankman-Fried apologises for his "mistakes"

Earlier this month, in his first public appearance after the collapse of FTX, he said, “I'm deeply sorry about what happened. Clearly, I made a lot of mistakes or things I would be able to give anything to be able to do over again.” The FTX founder was addressing a&nbsp;conference in New York, speaking via video call, he also said that he didn't knowingly behave fraudulently.&nbsp;

ALSO READ |&nbsp;<a href="https://www.wionews.com/world/former-ftx-ceo-sam-bankman-fried-apologises-for-his-mistakes-says-didnt-knowingly-commit-fraud-538944">Former FTX CEO Sam Bankman-Fried apologises for his 'mistakes,' says didn't knowingly commit fraud</a> 
 
Furthermore, on December 4, the FTX founder&nbsp;took to Twitter and said that he would testify before the United States House Financial Services Committee after he is done <a href="https://www.wionews.com/business-economy/ftxs-bankman-fried-to-testify-before-us-house-committee-after-learning-and-reviewing-its-collapse-540324">“learning and reviewing”</a> the collapse&nbsp;of his cryptocurrency exchange platform. This was in response to&nbsp;the Committee Chair Maxine Waters who had also taken to the microblogging platform to invite him to speak at the panel's hearing scheduled for December 13.

What has the 'crypto genius' been arrested and charged for?

Notably, a day before the aforementioned hearing, he was&nbsp;arrested in the <a href="https://www.wionews.com/videos/wion-business-news-ftxs-sam-bankman-fried-questioned-by-bahamas-police-533929">Bahamas</a>. He was going to testify under oath about his crypto exchange platform. In recent weeks he had made several public and media appearances telling his version of the&nbsp;company's sudden failure from the crypto exchange platform's headquarters in the&nbsp;Bahamas.&nbsp;

On Tuesday, the US SEC said, "The Securities and Exchange Commission today charged Samuel Bankman-Fried with orchestrating a scheme to defraud equity investors in FTX Trading Ltd, the crypto trading platform of which he was the CEO and co-founder." The committee said that investigations of "securities law violations and into other entities and persons relating to the alleged misconduct are ongoing.”

The FTX founder has also been charged with allegedly using&nbsp;FTX customer funds, commingled with Alameda for large political donations, lavish real estate&nbsp;purchases, and undisclosed investments in ventures. Additionally, even though the company is based in the Bahamas since FTX raised $1.1 billion from at least 90&nbsp;US-based investors, the SEC will oversee the case, the agency asserted.&nbsp;

ALSO READ |&nbsp;<a href="https://www.wionews.com/world/sam-bankman-fried-ex-ceo-of-now-defunct-crypto-exchange-ftx-arrested-in-bahamas-542490">Sam Bankman-Fried, ex-CEO of now-defunct crypto exchange FTX, arrested in Bahamas</a>

During the hearing, the SEC also&nbsp;used&nbsp;FTX's collapse&nbsp;as an example to highlight the "very real risks that unregistered crypto asset trading platforms can pose for investors and customers alike,” said&nbsp;Gurbir Grewal, the agency's director&nbsp;of the division of enforcement.

He added,&nbsp;that while the investigation is underway for&nbsp;potential violations of federal securities laws, they are also holding&nbsp;Bankman-Fried responsible for "fraudulently raising billions of dollars from investors in FTX and misusing funds belonging to FTX’s trading customers.”

(With inputs from agencies)

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Sam Bankman-Fried, or SBF, known as the "cryptocurrency genius", was arrested on Monday (December 12) in the Bahamas at the request of the United States. Last month, he announced his resignation from FTX after facing a loss of 94 per cent of his net worth.

Sam Bankman-Fried, or SBF, known as the "cryptocurrency genius", was arrested on Monday (December 12) in the Bahamas at the request of the United States. Last month, he announced his resignation from FTX after facing a loss of 94 per cent of his net worth. The "cryptogenius," also known as "modern JP Morgan" for his intervening to save volatile exchanges, has now been charged with defrauding investors in the company, by the United States Securities and Exchange Commission. The arrest was made on the eve of Bankman-Fried's scheduled appearance at a US Congress hearing. Who is SBF? The 30-year-old began his career as a trader at Jane Street and eventually amassed a crypto empire. SBF studied Physics at MIT, and after joining Jane Street, in 2017, he learned about cryptocurrencies and began using his expertise in the market. In his early days, he started by purchasing bitcoin in the US and used to sell them in Japan, a minimum price of at least 10 per cent due to price difference. In 2017, SBF established his own cryptocurrency trading firm 'Almeda Research,' which offers liquidity in exchange for digital assets and cryptocurrencies. Two years later, in 2019, he launched FTX, turning it to be one of the top exchanges for buying and selling cryptocurrency derivatives. Forbes estimates his exchange is worth $40 billion. Watch | Binance walks away from FTX deal due to 'mishandled funds' Fried has designated himself as a 'selfless altruist,' who pledged to give the majority of his wealth to charity. Additionally, promised to provide billion-dollar support to US candidates to take precautions against pandemics. However, Cointelegraph reported that he till now has only donated only 0.1 per cent of his wealth. Fried's exchange worth fell drastically by 94 per cent in a single day, as reported by the Bloomberg Billionaires Index. His net worth was nearly $15.5 billion prior to this announcement of the company's financial crisis. The worth dropped to $991.5 million back in November. According to Fox News, the now-bankrupt founder of FTX, was also a generous supporter of Democratic candidates and liberal causes, contributing at least $38 million to left-wing organisations during the 2022 election cycle. What happened to FTX? Concerns of liquidity issues in Alameda and FTX began in 2022. The cryptocurrency platform FTX has recently filed for Chapter 11 bankruptcy in the US, as per the statement released. The drama in the world of digital currencies began after the largest cryptocurrency platform Binance said that it will sell its stock in the company, Binance eventually backed out of the agreement leaving the firm to acquire nearly $9.4 billion from investors. Investors sold FTT, FTX's tokens as a result. ALSO READ | Cryptocurrency lender BlockFi files for bankruptcy; FTX fallout rattles crypto industry Notably, this crash left the finance world shocked after the company faced bankruptcy with panicked customers who began withdrawing billions from the platform. According to Bankman-Fried, traders pulled $6 billion from the platform within three days while Binance, a rival exchange platform, declined to sign a rescue deal. Two individuals familiar with the matter told Reuters that Bankman-Fried secretly transferred $10 billion in client money to affiliated trading firm Alameda Research, causing a liquidity crunch at the FTX. He has since told the news agency that did not move the money or run the research firm. The FTX collapse and fallout The fallout of this collapse was felt beyond the crypto world. A number of celebrities who endorsed his now-toxic exchange such as NFL quarterback Tom Brady and comedian Larry David were sued by the cryptocurrency investors who claimed they used misleading tactics to market FTX yield-bearing digital currency accounts. ALSO WATCH | Trending on WION: Former FTX founder Sam Bankman-Fried arrested in Bahamas The class action lawsuit filed in Miami, last month also included Brazilian supermodel Gisele Bündchen, basketball legend Shaquille O'Neal, tennis star Naomi Osaka as well as The Golden State Warriors basketball franchise. Meanwhile, the collapsed crypto exchange by the end of November began a strategic evaluation of its worldwide assets and is putting some businesses up for sale or reorganisation. Furthermore, with its 101 associated companies, FTX also requested judicial intervention to permit the functioning of a new worldwide cash management system and payment to its essential suppliers. Subsequently, crypto lender, BlockFi filed for bankruptcy citing the “significant exposure” to FTX which led to a liquidity crisis. Bankman-Fried apologises for his "mistakes" Earlier this month, in his first public appearance after the collapse of FTX, he said, “I'm deeply sorry about what happened. Clearly, I made a lot of mistakes or things I would be able to give anything to be able to do over again.” The FTX founder was addressing a conference in New York, speaking via video call, he also said that he didn't knowingly behave fraudulently. ALSO READ | Former FTX CEO Sam Bankman-Fried apologises for his 'mistakes,' says didn't knowingly commit fraud Furthermore, on December 4, the FTX founder took to Twitter and said that he would testify before the United States House Financial Services Committee after he is done “learning and reviewing” the collapse of his cryptocurrency exchange platform. This was in response to the Committee Chair Maxine Waters who had also taken to the microblogging platform to invite him to speak at the panel's hearing scheduled for December 13. What has the 'crypto genius' been arrested and charged for? Notably, a day before the aforementioned hearing, he was arrested in the Bahamas. He was going to testify under oath about his crypto exchange platform. In recent weeks he had made several public and media appearances telling his version of the company's sudden failure from the crypto exchange platform's headquarters in the Bahamas. On Tuesday, the US SEC said, "The Securities and Exchange Commission today charged Samuel Bankman-Fried with orchestrating a scheme to defraud equity investors in FTX Trading Ltd, the crypto trading platform of which he was the CEO and co-founder." The committee said that investigations of "securities law violations and into other entities and persons relating to the alleged misconduct are ongoing.” The FTX founder has also been charged with allegedly using FTX customer funds, commingled with Alameda for large political donations, lavish real estate purchases, and undisclosed investments in ventures. Additionally, even though the company is based in the Bahamas since FTX raised $1.1 billion from at least 90 US-based investors, the SEC will oversee the case, the agency asserted. ALSO READ | Sam Bankman-Fried, ex-CEO of now-defunct crypto exchange FTX, arrested in Bahamas During the hearing, the SEC also used FTX's collapse as an example to highlight the "very real risks that unregistered crypto asset trading platforms can pose for investors and customers alike,” said Gurbir Grewal, the agency's director of the division of enforcement. He added, that while the investigation is underway for potential violations of federal securities laws, they are also holding Bankman-Fried responsible for "fraudulently raising billions of dollars from investors in FTX and misusing funds belonging to FTX’s trading customers.” (With inputs from agencies) WATCH WION LIVE HERE

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