Trapped Inside The Collapse of FTX with Travis Kling - WBD608
The Peter McCormack Show
Peter McCormack
4.7 • 2.8K Ratings
🗓️ 20 January 2023
⏱️ 98 minutes
🧾️ Download transcript
Summary
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.
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Transcript
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| 0:00.0 | The bad guys are kicking the shit out of the good guys. Look at what just happened. This shit is in shambles right now. |
| 0:12.5 | The space has this attack vector from intelligent sociopaths. |
| 0:18.6 | And they've done so much damage at this point. |
| 0:21.1 | Hello there from Austin in Texas. |
| 0:24.0 | I'm about to fly home. |
| 0:25.4 | This sprint is finished. |
| 0:27.0 | It's been a really busy time. |
| 0:28.3 | We've been to Nashville to make shows. |
| 0:29.8 | We've been to Austin to make shows. |
| 0:31.2 | And then we've been all over Texas and Oklahoma making this |
| 0:34.6 | film this third part of my series follow the money. I just want to say a big thanks to |
| 0:38.9 | everyone who's helped with everything. It's been a busy trip we've got a lot, but I'm really proud of the work we've done. |
| 0:44.0 | Also, you know what, a big shout out to my team to Danny, Jeremy, Neil, Emma, Ben, everyone who works on this because they worked so hard to help us produce all this great content. |
| 0:53.0 | Anyway, welcome to the What Bitcoin did podcast, which is brought to you by Gemini, |
| 0:57.0 | the only place I'm using for buying Bitcoin. |
| 0:59.0 | I'm your host, Peter McCormack, and today I've got quite tough interview actually I've got my friend |
| 1:03.8 | Travis coming on the show now Travis runs a fund called Icky and they were |
| 1:08.3 | caught up in the FTX situation their fund held a large majority of their assets on FTX when they pause |
| 1:15.5 | withdrawals and it's caused a lot of the problems for Travis, it's caused a lot of problems |
| 1:20.0 | for the fund. And Travis being a friend, you know,'s a lot to see him go through I've been a |
| 1:24.4 | friend of Travis now for I don't know four years I've known this since pretty much not |
| 1:29.3 | long after I started the podcast I met him in LA we've hung out a bunch of |
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