In this news:
NEW YORK, US - JANUARY 03: Sam Bankman-Fried leaves the court in New York, on January 03, 2023. ... More (Photo by Fatih Aktas/Anadolu Agency via Getty Images)
Anadolu Agency via Getty Images
The media loves celebrating the meteoric rise of millionaires and billionaires. It’s a feel good story. They highlight their lavish lifestyles and business triumphs. Sometimes it seems that everyone is doing fabulously well, and we’re missing out. Not everyone has a happy ever after story. Those who amassed vast fortunes only to lose some or all of their wealth are less frequently told. These tales of financial downfall, driven by poor investments, fraud, economic crises, or personal missteps, offer valuable lessons about the fragility of wealth. Here’s the stories of some formerly prominent millionaires and billionaires who lost it all or nearly everything.
Sam Bankman-Fried’s Financial Rise and Fall
Sam Bankman-Fried (SBF), once a crypto wunderkind, amassed and lost a staggering fortune through his ventures, FTX and Alameda Research. He was ultimately convicted for fraud. His career trajectory, from a high-flying billionaire to a convicted felon with a net worth of zero, offers a cautionary tale of unchecked ambition and flaunting the laws.
After graduating from MIT in 2014 with a physics degree, he joined Jane Street Capital, a quantitative trading firm. His salary likely ranged from $100,000 to $300,000 annually. In 2017, he pivoted to crypto, founding Alameda Research. By exploiting Bitcoin arbitrage opportunities, such as price differences between Japan and the U.S., Alameda generated daily profits up to $1 million.
The launch of FTX in 2019 catapulted SBF’s wealth. As CEO and majority owner, he benefited from FTX’s meteoric rise. By 2021, FTX raised $900 million at an $18 billion valuation, followed by $400 million in January 2022 at a $32 billion valuation.
SBF’s net worth peaked at $26.5 billion in early 2022, with most tied to his FTX stake, FTT tokens, and a 7.6% Robinhood stake ($648 million, later seized). Cumulatively, SBF’s career earnings, salary, trading profits, and equity gains, likely exceeded $3 billion in asset value at their peak, though much was illiquid and tied to crypto valuations.
.png)
