FTX founder Sam Bankman-Fried agrees to testify at U.S. House hearing on Tuesday

Key Points
  • Crypto executive Sam Bankman-Fried agreed to testify before the House Financial Services committee, after CNBC reported that Representative Maxine Waters would not be pursuing a subpoena.
  • Bankman-Fried also sparred with Binance founder Changpeng "CZ" Zhao, telling him that he'd "won."
  • FTX's implosion left millions of creditors without their funds, and ranks as one of the largest corporate bankruptcies of all time.
FTX's Sam Bankman-Fried tweets that he's willing to testify before lawmakers
FTX's Sam Bankman-Fried tweets that he's willing to testify before lawmakers

FTX founder Sam Bankman-Fried has agreed to testify before the House Financial Services Committee at a hearing about the crypto exchange's collapse on Tuesday, he said in a series of tweets Friday morning.

There's been a lot of back and forth in Washington over whether lawmakers would have to subpoena Bankman-Fried, who said he would voluntarily testify since the committee "still thinks it would be useful." It was unclear whether he would show up on Capitol Hill in person or stay in the Bahamas where he's been holed up for much of the time since his company filed for bankruptcy last month, holding interviews with reporters.

In his tweet thread, the disgraced former "darling" of crypto appeared to lay blame on Binance founder Changpeng "CZ" Zhao.

The ex-CEO of FTX has been on a media blitz the last month talking about the implosion of his crypto empire, but this will be the first time the public has the chance to hear from SBF under oath.

Sam Bankman-Fried, founder and chief executive officer of FTX Cryptocurrency Derivatives Exchange, during a Senate Agriculture, Nutrition and Forestry Committee hearing in Washington, D.C., on Wednesday, Feb. 9, 2022.
Sarah Silbiger | Bloomberg | Getty Images

Bankman-Fried wrote that he still did not have access to much of his data, professional or personal, so there was a "limit" to what he would be able to say.

"I won't be as helpful as I'd like. But as the committee still thinks it would be useful, I am willing to testify on the 13th," continued the post.

Bankman-Fried used his tweet thread to antagonize Binance boss Zhao, claiming that he had "won," and that the restrictions that Zhao wanted to impose as part of Binance's aborted bailout were excessively onerous.

Bankman-Fried didn't think there were any winners, he said in a tweet.

"Seeing how CZ talks, I'm pretty sure he does," Bankman-Fried continued.

"Sam was so unhinged when we decided to pull out as an investor that he launched a series of offensive tirades at multiple Binance team members," Zhao wrote in a Twitter thread.

In the days leading up to FTX's collapse, Zhao was heralded as a potential savior for the exchange. FTX was once considered to be the most stable and reliable crypto exchange in the industry, but an article from CoinDesk revealed an alarming concentration of self-issued FTT tokens being used as collateral for billions in loans for Alameda Research, Bankman-Fried's crypto hedge fund. The article, paired with Alameda CEO Caroline Ellison's tweet activity, sent FTX into a liquidity crisis.

Bankman-Fried was responding to a series of tweets posted by Zhao about why Binance walked out on the potential acquisition offer. When Binance stepped away, FTX fell into freefall, ultimately filing for bankruptcy protection shortly after.

Zhao torched Bankman-Fried for rampant spending on vanity projects from marketing to "mansions." He was responding to a Thursday morning appearance by CNBC contributor Kevin O'Leary on "Squawk Box."

O'Leary had said that he lost his entire $15 million payday and was embarrassed at his lack of due diligence.

Bankman-Fried has played coy with lawmakers, despite a threat to subpoena him from the Senate Finance Committee this week and repeated demands from House Financial Services Chair Maxine Waters, D-Calif., to testify under oath at that panel's hearing.

Investors and regulators have been seeking answers from Bankman-Fried for some time now. Despite several highly publicized media and Twitter spaces appearances, the former billionaire has revealed little about the chaotic final days at FTX.

A growing number of investors and pundits believe that the only place Bankman-Fried should be is in prison. Legal experts CNBC spoke with say that his sentence could hypothetically run for his entire life, if convicted.

Before Bankman-Fried agreed to testify, CNBC reported that Waters was not planning to subpoena the ex-billionaire. Waters pushed back, claiming a subpoena was "absolutely" on the table.