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Sam Bankman-Fried was 'delusional' about how FTX collapsed and the culpability he deserves, Mike Novogratz says

This is a phot of Michael Novogratz speaking in stage with a black background.
Mike Novogratz, CEO of Galaxy Investment Partners.Marco Bello / Stringer /Getty Images
  • Sam Bankman-Fried is "delusional" about the downfall of FTX and his level of culpability in it, Mike Novogratz said.

  • At the DealBook Summit, Bankman-Fried tried to deny having any knowledge of what was happening in his crypto empire.

  • "Markets are based on trust. And when you have trust broken like this, it questions everyone else," Novogratz told CNBC.

Sam Bankman-Fried is "delusional" about the downfall of FTX and his level of culpability in it, crypto bull Mike Novogratz said Thursday.

The comments came a day after Bankman-Fried spoke at the New York Times' DealBook Summit, where he tried to deny having any knowledge of what was happening in his crypto empire.

For example, he said "didn't knowingly commingle" FTX customer funds with those of Alameda Research. "I wasn't running Alameda. I didn't know what was going on. A lot of the things were things I learned over the last month."

Bankman-Fried also said he "did not ever try to commit fraud" and didn't realize the risky positions his firms had taken until too late. And he said, "I don't know of times when I lied," adding that he "was as truthful as I'm knowledgeable to be."

But while speaking to CNBC on Thursday, Novogratz wasn't buying any of it.

"It was delusional. Let's be really clear. Sam was delusional about what happened and his culpability in it," the Galaxy Investment Partners chief executive said.

He added that Bankman-Fried is likely to face jail time while noting that he didn't act alone.

"They perpetuated a large fraud and it wasn't just Sam," Novogratz said. "You don't pull this off with one person."

He also said he hopes authorities get to the bottom of the FTX collapse, not just for sake of the crypto market but also for all markets.

"Markets are based on trust. And when you have trust broken like this, it questions everyone else. People start looking for black swans everywhere," Novogratz said.

Read the original article on Business Insider