Trapped Inside The Collapse of FTX with Travis Kling - WBD608

Travis Kling is the Chief Investment Officer at Ikigai. In this
interview, we discuss being on the frontline of the FTX collapse:
Ikigai had a large majority of its investment funds in FTX when
it stopped withdrawals; Travis had a majority of his liquid net
worth also stuck in the bankrupt company.


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2022 will be a defining moment for crypto. In November 2021, the
total market valuation was approaching $3 trillion. By the middle
of 2022 the market valuation was down to $800 million. UST had
depegged in May and caused contagion to ripple through the
market: in short order Celsius, 3AC and Voyager all filed for
bankruptcy. And yet, the biggest shoe was yet to drop.


In January 2022 FTX was valued at $32 billion. The
August/September issue of Fortune magazine compared FTX’s founder
and CEO Sam Bankman-Fried (SBF) to Warren Buffet. Commentators,
investors and media outlets likened SBF to JP Morgan as he bailed
out struggling competitors. He’d been hosted by congressional
committees in DC to help shape legislation multiple times. SBF
was seemingly untouchable.


That all changed in November with a rapid fall. On November 2nd
CoinDesk reported on concerning balance sheet issues at FTX’s
sister company Alameda Research. On November 6th, Binance
announced it would liquidate its entire holding of FTX’s FTT
token. On November 7th a run on FTX began. On November 8th FTX
halted withdrawals. Days later it filed for bankruptcy.


SBF was orchestrating a years-long fraud of epic proportions.
Some in the industry had raised concerns, but many believed the
hype. What Bitcoin Did did not have a relationship with FTX, but
there are scenarios where that could have been different. Others
did have relationships with FTX. For example Travis Kling, who
had a large majority of his investment funds and personal liquid
net worth stuck in FTX.


On November 14th Travis posted a Tweet thread: “I have some
pretty bad news to share… I lost my investors’ money after they
put faith in me to manage risk and I am truly sorry for that. I
have publicly endorsed FTX many times and I am truly sorry for
that. I was wrong.” This show goes through what happened and
reflections on where we go from here. As this show goes live
shortly after Genesis filed for bankruptcy, it’s obvious we’re
still in the midst of this mess.