Sam Bankman-Fried, founder of the collapsed FTX crypto exchange and associated trading firm Alameda Research, struggled with the pros and cons of his personal relationship with former Alameda co-CEO Caroline Ellison, according to Michael Lewis’ book “Going Infinite.”
“In a lot of ways I don’t really have a soul,” Bankman-Fried wrote in a memo to Ellison, taking an analytical approach for and against the relationship. While his “arguments against” list highlighted his self-perceived flaws and the potential PR disaster their relationship could cause, his “arguments in favor” list was succinct, emphasizing his affection for her.
Bankman-Fried had found himself stretched thin between his responsibilities at Alameda and his public role at FTX, delegating day-to-day operations at Alameda to Sam Trabucco, a trader known to SBF since high school math camp, and Ellison. SBF imagined Trabucco managing trading risks with Ellison managing the staff. However, Trabucco’s “shocking shift” in work ethic after he was promoted to co-CEO left Ellison managing both personnel and trading risks, with only Bankman-Fried overseeing her.
That created some complications given Bankman-Fried and Ellison’s relationship was more than professional, with Ellison wanting to expand the relationship and Bankman-Fried not, Lewis wrote.
‘This could destroy Alameda’
“There’s a pretty decent argument that my empathy is fake, my feelings are fake, my facial reactions are fake,” Bankman-Fried continued in his arguments against the relationship. “I’m worried about power dynamics between us. This could destroy Alameda if it goes really poorly PR-wise.”
On the flip side, Bankman-Fried expressed his affection for Ellison, feeling like he could talk openly with her and that she was “a good person, smart and impressive” with “good judgment.”
Ellison’s desire for a more traditional relationship was evident in her memos to Bankman-Fried. However, she wasn’t happy with the couple’s communication on their feelings and lack of social affirmation of their relationship, believing Bankman-Fried’s arguments were masking his true motives. “I guess a lot of what bothers me is feeling like you’re ashamed of me,” she later wrote.
“If I felt you also felt positive about people knowing we were dating but just thought it was a bad idea to share, I think I wouldn’t mind as much,” Ellison explained. “Again, I feel like if I were better/more impressive, you wouldn’t be embarrassed for people to know we were dating.”
Disclaimer: The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.
© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.