Shark Tank star Kevin O’Leary, aka Mr. Wonderful, has shared how he and Sam Bankman-Fried (SBF) almost raised $8 billion from institutional investors to save crypto exchange FTX before it collapsed. However, when reports emerged of FTX being investigated by several authorities, including the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC), all interested investors vanished.
Kevin O’Leary tries to raise money to save FTX
In an interview with Insider published on Sunday, Kevin O’Leary shared how he tried to save cryptocurrency exchange FTX before it collapsed. O’Leary is a paid spokesperson for FTX and has investments in the company.
Prior to FTX’s bankruptcy filing on Nov. 11, Mr. Wonderful was talking to a number of prospective investors interested in owning a stake in the crypto exchange. Sovereign wealth funds were interested in investing $8 billion to rescue FTX, he told the publication.
Noting that Bankman-Fried called him to discuss the investment, O’Leary shared:
We had a brief chat. He was very rational. We discussed a few things about the timing of $6 billion to $8 billion. But that was enough information for me to go back to the sources that interested me and confirm the number eight.
Mr. Wonderful noted that Bankman-Fried said during their call that regulators will “come down hard” on the situation.
However, rescue offers quickly dried up as reports emerged that the Securities and Exchange Commission (SEC), Department of Justice (DOJ), and other global regulators were closing in on FTX. O’Leary continued:
All of those interested parties were gone … I texted that back to Sam … and I told him that was not going to be an option.
Still, O’Leary believes that if a sovereign wealth fund or other buyers had pumped in roughly $4 billion, investors would have felt confident placing their assets in FTX. “So what was really on the table and it was being debated around the world that you can buy a $32 billion asset for $4 billion,” he said.
‘There’ll Be a Mountain of Litigation’
Mr. Wonderful has started moving his assets elsewhere, he revealed, noting that Canada is the only country that offers fully-regulated broker-dealer exchange accounts. “We have confidence that the regulatory environment in Canada scrutinizes accounts that can’t be commingled,” the Shark Tank star opined, adding that he believes the market has not seen the bottom of the FTX fallout yet.
Commenting on the FTX meltdown rattling trust in the crypto sector, O’Leary said:
There are a lot of allegations flying around… It’s a tough situation, there’s no doubt about it. There will be a mountain of litigation.
Despite regulators investigating Bankman-Fried and the crypto industry screaming fraud, O’Leary maintains he’s never met a more brilliant mind when it comes to crypto and blockchain. He described:
He is an expert… He is probably one of the most skilled traders of crypto in the world, and that is why I was very impressed.
Last week, the Shark Tank star said he would back Bankman-Fried again if he has another venture. This has outraged the crypto industry since most people believe that the former FTX CEO engaged in multiple fraudulent activities.
Like other FTX investors, including the Singapore government’s Temasek Holdings and the Ontario Teachers’ Pension Fund, O’Leary is writing off all of its FTX investments. He said: “I am writing that all down to zero … It is not clear what can be recovered.”
