Sam Bankman-Fried‘s father, Joe Bankman, played a significant role in advising FTX, the cryptocurrency exchange that faced controversy leading to its downfall.
Joe Bankman, a law professor at Stanford University, had a more involved role in FTX operations than previously known, according to a recent report from Insider.
One notable instance of Bankman’s involvement was his appearance in FTX’s Super Bowl ad alongside Larry David, where he dressed as a founding father in a powdered wig.
Shortly after the ad aired, Bankman joined his son’s company as an employee, the report said, adding that former staff members from Alameda, FTX’s sister hedge fund, disclosed that Bankman also assisted in drafting early legal documents.
Furthermore, invoices from the company’s law firm listed Bankman as an attendee in meetings, indicating his participation in the development of marketing materials for FTX’s own cryptocurrency, FTT.
This is particularly noteworthy as FTT played a major role in the collapse of the crypto exchange.
The downfall of FTX started after it was revealed that a significant portion of Alameda’s $14.6 billion in assets consisted of the FTT token.
Following the revelation, customers rushed to withdraw their deposits, and FTX struggled to meet the demand due to extravagant spending by its executives.
As a result, the company filed for bankruptcy nine days later.
According to one former employee, Bankman-Fried frequently consulted his father, with SBF often stating that he needed to “call Joe” first when faced with legal suggestions from employees.
SBF’s Father Used Alameda Funds to Pay For His Legal Defense
In a late March report, Forbes revealed that Bankman has been funding his son’s legal defense after receiving a $10 million gift from company funds.
Another report in July revealed that Joe squandered at least a million of Alameda funds on ill-advised cryptocurrency trades.
The report revealed that Gabe Bankman-Fried, Sam’s brother, was also deeply involved in FTX’s operations.
Gabe, a former Democratic politico, ran a nonprofit organization primarily funded by FTX.
He also promoted the concept of effective altruism, a philosophy that seemingly aimed to help humanity with monetary contributions.
However, it was revealed that he authored a memo proposing the purchase of Nauru, a small island nation, to create a bunker for survival in the event of a global catastrophe.
Meanwhile, in the latest development in the FTX saga, it was revealed that the platform holds approximately $7 billion in assets, including $1.16 billion worth of Solana (SOL) tokens and $560 million in Bitcoin (BTC).
On Wednesday, a judge in the US Bankruptcy Court for the District of Delaware ruled that FTX can sell and invest its crypto holdings to pay back creditors.
Justin Sun, the founder of Tron Network, has said that he is considering making a bid for the assets held by FTX to reduce the impact a sale could have on the market as he aims to ignite growth in the sector.