Sam Bankman-Fried, the new crypto king?

Some already see him as the JP Morgan of the crypto era. Others are the same: the savior of the crypto industry, their Robin Hood. With a fortune of over $11 billion, Sam Bankman-Fried is currently the second richest crypto-entrepreneur in the world, just behind Binance CEO Changpeng Zhao. According to Forbes, only Mark Zuckerberg became richer faster than the 30-year-old today. His self-proclaimed goal: to amass as much wealth as he can. And then donate it to charity. He calls it “effective altruism.” As a result of the crisis, the 30-year-old may become the new crypto king.

About five years ago, he didn’t even own a bitcoin. Then Sam Bankman-Fried joins millions as a crypto trader by exploiting a loophole, a significant bitcoin price difference between Japan and the US. He ends up making $25 million in profit on one trade. With the money and generous funds from foundations, he founded FTX in 2019. After only three years, it is one of the most valuable and largest US crypto exchanges with a gigantic war chest.

According to his own statements, he has set up a rescue fund of over two billion US dollars. In June 2022, Sam Bankman-Fried lent over $250 million to now-bankrupt crypto broker Voyager Digital, then bought struggling crypto lender BlockFi at an affordable price ($25 million instead of $4 billion), which previously held shares in the broker Robinhood. His latest target: Bithumb, one of South Korea’s leading crypto exchanges. According to Bloomberg, a takeover is under discussion.

Vegans with a gambler’s heart who do without luxury

Sam Bankman-Fried was born on the Stanford campus in 1992 to two elite law professors. After graduating from a private high school in the Bay Area, he studied physics at MIT for four years. However, he spends most of his time playing video games such as “Starcraft” and “League of Legends”. He loves the thrill of making quick decisions under time pressure: “When he played chess or other games, he always insisted on playing with a timer,” a fellow student once said of him in an interview.

Despite his billion-dollar fortune, Bankman-Fried does without luxury. A vegan by conviction, he wears baggy clothes and drives a Toyota Corolla on the streets of the Bahamas, where he has lived since 2021. At night, he sleeps in the office, on a bean bag. Less than five hours a night. The employees can wake him up at any time when they seek advice. At university he discovers the teaching of “effective altruism”. And adapts his life accordingly.

So far, Sam Bankman-Fried has rarely donated to charity

The movement was founded in 2011 by two Oxford philosophers. Her maxim: Use your own time and resources in such a way that you can achieve the greatest possible benefit for the greatest possible number of people. Sam Bankman-Fried plans to donate 99 percent of his fortune when the time comes. Keep only $100,000 per year. He hasn’t put any of this into practice yet. According to Forbes, he has so far donated only $25 million, about 0.1 percent of his fortune. Fewer than any other billionaire among the world’s richest 400 people. In other words: Sam Bankman-Fried still has to enjoy a bit of the crisis before he can save the world for a moment.

What he currently spends a lot of money on: marketing, investment deals and lobbying. In 2020, Bankman-Fried will become the second largest donor to the Biden campaign, behind Michael Bloomberg, with over $5 million. For the 2024 election, he announced that he would support Democrats with up to $1 billion to prevent Donald Trump from winning. He would be the largest donor in American history.

He invested 135 million US dollars for the sponsorship rights to the Miami Heat basketball arena, he smeared hundreds of millions in e-sports deals and the Mercedes Formula 1 team. The majority of his wealth is in shares of FTX – and various cryptocurrencies, such as Solana (SOL). The 31-year-old star entrepreneur’s efforts: If he continues to ride the crypto wave, he can increase his fortune by a factor of 900. And later, also his donations.

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