Jim Chanos Criticizes Michael Lewis for Defending FTX
Famed short seller Jim Chanos has criticized author Michael Lewis for suggesting that FTX would still be operational if it hadn’t experienced a bank-like run on the bankrupt crypto exchange. Chanos compared Lewis’s defense to Enron’s, stating that both FTX and Enron were insolvent rather than illiquid. The criticism came after Lewis discussed former FTX founder Sam Bankman-Fried in an interview with CBS’s 60 Minutes, coinciding with the release of Lewis’s book on Bankman-Fried titled “Going Infinite: The Rise and Fall of a New Tycoon.” Lewis defended FTX, denying allegations of fraud and suggesting that it could have been profitable without the run on customer deposits.
Crypto Community Supports Chanos
Chanos received support from the crypto community, with Mike Dudas, founder of The Block, calling Lewis’s statements “insane.” Ryan Selkis of Messari also expressed anger towards the interview. FTX and its affiliated companies filed for bankruptcy protection in November after revealing a $6.8 billion deficit in their balance sheets. Bankman-Fried initially attributed the collapse to a run on customer deposits. Despite this, Lewis portrayed Bankman-Fried sympathetically during the interview, characterizing him as a wealthy individual focused on saving humanity rather than indulging in personal luxuries.
Bankman-Fried Faces Trial
The book serves as a letter to the jury ahead of Bankman-Fried’s trial, which begins today. He faces charges including wire fraud, securities fraud, conspiracy, and money laundering. Bankman-Fried has pleaded not guilty to all charges and will face criminal trial on October 4 following today’s jury selection.
Hot Take: Jim Chanos Dismisses Michael Lewis’s Defense of FTX
Renowned short seller Jim Chanos has criticized author Michael Lewis for defending FTX and comparing it to Enron. Chanos argues that both FTX and Enron were insolvent, not simply illiquid. Lewis’s statements drew support from the crypto community, with many expressing disbelief at his defense. Despite the controversy, Lewis released his book on Sam Bankman-Fried and portrayed him as a sympathetic figure. The trial against Bankman-Fried, facing charges of wire fraud and more, begins today after jury selection. The case has generated significant interest within the crypto industry and beyond.
Insa’s extensive background in the financial realm encompasses roles as a writer, trader, and personal finance coach. Her proficiency spans a wide spectrum, ranging from commodities and indices to forex and cryptocurrencies. Insa’s specialization lies in furnishing strategic investment advice tailored to the fintech investment niche.