SHOW / EPISODE

THE FTX COLLAPSE / SAM BANKMAN-FRIED

Season 12 | Episode 230
24m | Oct 23, 2026

Episode 230 | Historical Events


In this History episode we focus on the FTX collapse — Sam Bankman-Fried, a $32 billion cryptocurrency exchange that went from peak to bankruptcy in 96 hours, and $8 billion in customer funds that had been used as a trading slush fund for the affiliated firm Alameda Research from the first month of FTX's operation. The fraud was not discovered by regulators or auditors. It was exposed by a CoinDesk article about Alameda's balance sheet.


We trace the specific mechanics of the fraud — Alameda's secret line of credit from customer deposits, the $8 billion liability hidden in a folder called "our Korean friend's account" — alongside the institutional credulity that allowed a fraud this large to operate in plain sight for three years. John Ray III, who cleaned up Enron, described FTX as unlike anything he had seen in his career. Bankman-Fried was convicted in November 2023 on seven counts and sentenced to 25 years in prison. A federal court ordered $12.7 billion in customer repayment in 2024 — an unusual outcome in which most customers received full recovery because the estate's assets had appreciated during bankruptcy.



This podcast features narration with a synthetic AI voice.

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