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Hailed as ‘next Warren Buffet’, Sam Bankman, whose crypto empire crashed, held

Disputed cryptocurrency magnate and former FTX CEO Sam Bankman-Fried was arrested in the Bahamas after facing criminal charges by US prosecutors. US officials have attempted to sue Bankman-Fried after the spectacular collapse of its FTX platform.

The arrest comes on the eve of Bankman-Fried’s scheduled appearance at a U.S. Congressional hearing, where he would testify under oath about the sudden demise of the crypto exchange. (Also read | Bankman-Fried’s FTX, Parents Bought $121M Bahamas Property: Report)

“Earlier tonight, Bahamian authorities arrested Samuel Bankman-Fried at the request of the U.S. government, based on a sealed indictment filed by the Southern District of New York,” U.S. Attorney Damian Williams said in a statement.

“We expect to take action tomorrow morning to unlock the charges and will have more to say by then,” he added.

Everything you need to know about the FTX-Sam Bankman-Fried saga

Once one of the world’s largest cryptocurrency exchanges, FTX filed for bankruptcy protection on November 11 in one of the most high-profile crypto bursts.

The liquidity crisis came after Bankman-Fried secretly moved $10 billion in FTX client funds to Alameda, Reuters reported, citing two people familiar with the matter.

FTX’s valuation imploded after a Nov. 2 report on ties between FTX and Alameda, a trading company also controlled by Bankman-Fried, revealed that Alameda’s balance sheet was built heavily on the FTT currency — a token created by FTX and without independent value.

The price of FTT plummeted in early November, confusing both Alameda and FTX.

Samuel Bankman-Fried had defied legal advice in recent weeks and offered his version of his company’s sudden bankruptcy, mostly via video link from the Bahamas, where his company’s headquarters are located.

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(With input from AFP, Reuters)


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