At the end of a 15,000-word Twitter thread that he never posted, Sam Bankman-Fried, the founder of failed cryptocurrency exchange FTX, offered a blunt assessment of his predicament.
“I’m broke, wear an ankle monitor and am one of the most hated people in the world,” he wrote. “There will probably never be anything I can do to make the impact of my life net positive.”
He added: “And the truth is I did what I thought was right.”
After Mr Bankman-Fried was arrested, charged with fraud over the collapse of the FTX and placed in house arrest in December, he wrote hundreds of pages of sometimes lengthy self-justifications, ranging from childhood memories to mathematical calculations.
In a draft of his unsent messages, which he formatted as a series of tweets spanning about seventy typed pages, he criticized some of his closest colleagues, interspersing his arguments with photos from his high school days and stock photos of popcorn and a maze in the garden. Every few pages, a key moment in the story is accompanied by a link to a music video by Alicia Keys, Katy Perry or Rihanna.
Once a prolific poster on Twitter, now known as One document, titled “Inception V2,” is a lengthy attack on the company’s bankruptcy lawyers, featuring a screenshot from the 2010 Christopher Nolan film. A separate link opens a spreadsheet of Mr. Bankman-Fried’s Amazon orders from 2021.
The roughly 250 pages of documents, which have not previously been reported, provide an insight into Mr. Bankman-Fried’s mindset during the eight months he spent in home detention before a judge revoked his bail in August. The writings also provide new details about his possible legal defense, beyond what his lawyers revealed in court, and shed light on how he can justify his actions when his trial begins on October 3.
Prosecutors have accused Mr. Bankman-Fried of orchestrating a scheme to funnel FTX client funds to a hedge fund he founded, Alameda Research, so his companies could make venture capital investments, buy real estate and donate to politicians. He has pleaded not guilty and faces decades in prison if convicted.
During his house arrest, Mr Bankman-Fried sent the documents to Tiffany Fong, a social media influencer who has a YouTube channel about the crypto industry. Ms. Fong shared them with DailyExpertNews.
“He liked the fact that I don’t work for anyone,” she said. “He thinks I can just come to my own conclusions.”
A representative for Mr. Bankman-Fried declined to comment.
In several documents, Mr. Bankman-Fried accused Caroline Ellison, his former girlfriend and former lieutenant, of helping to cause the implosion of FTX. He described her as ill-equipped for the job he gave her as head of Alameda, claiming she had cried during a meeting with him and refused to implement trading strategies that would have protected his companies from a market crash.
“She persistently avoided talking about risk management — and dodged my suggestions — until it was too late,” he wrote in a document titled “Alameda’s Failure to Hedge.” “Every time I reached out with suggestions, she just felt worse. I’m sure being exes didn’t help.”
In the Twitter draft, Mr. Bankman-Fried also criticized Sam Trabucco, who was co-chief executive of Alameda. Mr. Trabucco and Ms. Ellison did not get along, the document said. And while Mr. Trabucco had good risk-management instincts, Mr. Bankman-Fried wrote, he was “in the process of quietly quitting” at the end of 2021.
Mr. Trabucco preferred to spend his time “going on dates with a bunch of guys while sailing around the world on a boat,” Mr. Bankman-Fried wrote. He then linked to a music video, “Cheers (Drink to That)” by Rihanna.
Ms Ellison and two of Mr Bankman-Fried’s other top advisers have pleaded guilty to fraud charges and agreed to testify against him. A fourth pleaded guilty this month without promising to cooperate. Mr. Trabucco has not been accused of any wrongdoing.
Lawyers for Mr. Trabucco and Ms. Ellison declined to comment.
Once hailed as a reliable force in the loosely regulated world of crypto, FTX imploded in November, costing customers billions of dollars and devastating the industry. After his arrest, Mr. Bankman-Fried was granted bail and allowed to live with his parents, who are longtime law professors at Stanford, at their home in Palo Alto, California. They had a German Shepherd named Sandor act as his watchdog. .
For months, Mr. Bankman-Fried has entertained guests such as the author Michael Lewis, who is completing a book about him, as well as several reporters.
Few people had as much access as Ms. Fong, the influencer, who had built a rapport online with Mr. Bankman-Fried before FTX failed. Ms. Fong visited him at his parents’ home more than a dozen times, she said, recording conversations with him that she might eventually release.
During house arrest, Mr. Bankman-Fried spent much of his time in the study, Ms. Fong said, playing computer games, setting up a chess board and sometimes sleeping on the couch. Most days, she said, he worked on his legal defense, recording his thoughts about the case on hundreds of pages of Google Docs. Mr Bankman-Fried also told her that his family was installing a pickleball court for him in the garden.
Mr Bankman-Fried presented Ms Fong with the documents at the end of January. It wasn’t clear what he expected her to do with it. Ms Fong, who lost money in the collapse of crypto firm Celsius Network, said she sympathized with FTX’s victims and was skeptical of many of Mr Bankman-Fried’s claims. She sent a document to a former Alameda engineer: Aditya Baradwajwho responded to her with a point-by-point rebuttal to Mr. Bankman-Fried, noting that Alameda’s hedging would have been “irrelevant” if FTX had not misused customers’ money.
In the draft Twitter thread, Mr. Bankman-Fried traced the growth of his companies from his childhood in Palo Alto to the penthouse he bought in the Bahamas, near FTX’s headquarters. He recalled meeting Mr. Trabucco at a math camp, where his future colleague would sneak out after curfew to bake cheesecake brownies, and described his early admiration for Ms. Ellison, calling her “wicked smart.” He also included some personal photos, including one of him holding a shirt Mr. Trabucco bought him in high school.
An image of Mr. Bankman-Fried from high school that he included along with a handful of personal photos from his youth in the draft of an unpublished Twitter thread.
In another section, Mr. Bankman-Fried posted a link to a paper he wrote in 2019, “Tonight We Are Young,” a report from a conference in Taiwan where he interacted with Changpeng Zhao, known as CZ, the founder of the cryptocurrency. Exchange Binance. (He also included a link to Fun’s “We Are Young” music video.)
“Tonight was a night about booze and women and lasers and loud, thumping music, but there was a strange microclimate that seemed to follow me,” Mr. Bankman-Fried wrote. “I walked past CZ a few more times, and each time he broke eye contact with his eye candy and hugged me: people were thinking about us a lot.”
In November, Mr. Zhao’s posts sparked a run on deposits that helped trigger FTX’s implosion. A Binance representative did not respond to a request for comment.
Some of Mr Bankman-Fried’s documents elaborate on arguments made by his lawyers in court. In files titled “Inception V2,” “Inception V3,” and “Inception Evidence,” Mr. Bankman-Fried alleged that Sullivan & Cromwell, the law firm that oversaw FTX’s bankruptcy, constructed the story that he was embezzling user funds.
“They played incredibly well,” he wrote. “If it wasn’t destructive to just about everything I care about in life, I’d tip my hat to that.”
A spokesperson for Sullivan & Cromwell declined to comment. Prosecutors have argued that Mr Bankman-Fried’s claims about the firm amount to “innuendo”.
In several documents, Mr. Bankman-Fried also dissected his history with Ms. Ellison, writing that their relationship ended “the same way most of my relationships end.”
“They want more intimacy, involvement and public visibility than I do,” he wrote in the thread, “and I feel claustrophobic.”
In another document, he said Ms. Ellison refused to hedge Alameda’s aggressive trading strategy despite his insistence. At one point, he recalls, he sent her a message that amounted to “the meanest thing I’ve ever said to her.” (He said he no longer had a recording of the message.)
“If Alameda had hedged, it would have remained solvent and avoided the whole unfortunate story,” he wrote.
His concerns about Alameda increased in the spring of 2022, Mr. Bankman-Fried wrote in the Twitter draft, as he packed for a trip to Washington. A group of employees, including Ms. Ellison, frantically discussed a possible shortfall in the company’s accounts. Mr. Bankman-Fried was only half involved, he wrote, but had heard enough to realize that the conversation focused on an account labeled fiat@ — the vehicle that regulators say FTX executives used to transfer money from redirect customers to other projects.
“I had heard that name before, but I never knew exactly what it was,” he wrote.
When she pleaded guilty, Ms. Ellison said she and Mr. Bankman-Fried conspired to prop up Alameda’s finances with customer money. He denies having misused the money.
“In general, I don’t lie,” he wrote in a document titled “Truth.” “It’s something I believe in quite strongly.”
