Coinbase CEO accuses Sam Bankman-Fried of blaming FTX’s $8 billion hole on an “accounting error”

The chief executive of Nasdaq-listed crypto-currency exchange Coinbase, Brian Armstrong, has criticized former FTX CEO Sam Bankman-Fried (SBF) for claiming that FTX lost $8 billion due to an “accounting error“. He emphasized, “This is stolen client money used in his hedge fund, pure and simple“.

Brian Armstrong on SBF’s ‘accounting error’ claim

Crypto-currency exchange Coinbase CEO Brian Armstrong has criticized FTX co-founder Sam Bankman-Fried (SBF) for blaming his collapsed exchange’s $8 billion deficit on an “accounting error“.

In an interview with Bloomberg, published Friday, Bankman-Fried was asked how he “Misplaced $8 billion“. The former FTX boss responded, “Misplaced“. He also explained that FTX customers would sometimes transfer money to his trading company, Alameda Research, instead of sending it directly to FTX. The crypto-currency exchange’s internal accounting system would then double-count the money, crediting it to both the exchange and the customers.

Many people aren’t buying Bankman-Fried’s excuse, including Coinbase’s CEO. Armstrong tweeted on Saturday:

I don’t care how messy your accounting (or wealth) is – you’ll definitely notice if you find an extra $8 billion to spend.

“Even the most gullible person should not believe Sam’s assertion that this was an accounting error“, the Coinbase executive pointed out.

Armstrong noted in a follow-up tweet:

This is stolen client money used in his hedge fund, plain and simple.

While most people in the crypto space agree with the Coinbase boss and think Bankman-Fried should go to jail for what he did, there are people who refuse to admit that SBF is a fraud.

Shark Tank star Kevin O’Leary, for example, insisted that SBF is one of the best traders in the crypto space and that he would support the former FTX executive again if he had another business. Billionaire hedge fund manager Bill Ackman also said he thinks Bankman-Fried was telling the truth when he said he “did not knowingly commingle the funds.“