Cointime

Download App
iOS & Android

How the Mooch Helped Push the First Domino in the FTX Crash

Donald Trump’s old press secretary, Anthony Scaramucci, played a fascinating role in the downfall of crypto exchange FTX. But he’s still a believer.

About 18 hours before his old boss Donald Trump announced a fresh tilt at the US presidency, former White House press secretary – for 11 days – Anthony Scaramucci revealed his role in the unravelling of crypto exchange FTX and the downfall of its founder, Sam Bankman-Fried.

It’s all The Mooch’s fault – sort of.

Anthony Scaramucci’s time in the White House was brief but very memorable. AP

In September this year, Scaramucci sold 30 per cent of his firm Skybridge to FTX; Bankman-Fried wanted to buy the lot but Scaramucci was hesitant. “I am 58 years old [and] it’s been my life’s work,” he told a Bloomberg event on Tuesday night.

Happily, Scaramucci got cash. Unhappily, Bankman-Fried requested The Mooch whack $US10 million ($14.8 million) into FTX s underlying crypto token, FTT, which Scaramucci did in the spirit of the deal.

Then, just a few weeks ago, Scaramucci took Bankman-Fried on a fundraising tour to the Middle East – “I’ve been doing this longer than Sam has been alive, so I have a lot of relationships over there” – which was designed to raise $US2 billion at a valuation of $US32 billion. Scaramucci says Bankman-Fried’s key message, which he now knows was “unfortunately made up”, was that the money would be used to buttress FTX’s balance sheet and allow it to buy distressed crypto assets to stabilise the sector.

But it was in some of those meetings, Scaramucci says, that Bankman-Fried started trash-talking Changpeng “CZ” Zhao, the founder and boss of rival crypto exchange Binance. This got back to Zhao, who then dumped his holdings of the FTT token, sparking a run that exposed the leverage inside FTX and Bankman-Fried’s other business, Alameda Research.

Scaramucci says that fateful Middle East trip, and Bankman-Fried’s trash talk, “tipped the first domino [of the FTX collapse] a lot earlier than that domino would have been tipped otherwise”.

Compared to his appearance at The Australian Financial Review Cryptocurrency Summit in April, Scaramucci looked decidedly downbeat. While he hopes to buy the 30 per cent stake in Skybridge back from FTX’s liquidators, that’s likely to involve a long fight. He insists his due diligence was thorough, but knows it clearly wasn’t good enough.

“I think it’s very hard to protect yourself from that misrepresentation. If just one person can avoid the calamity that I’m living with right now….it’s worth it for me to share the story.”

Still, Scaramucci hasn’t completely lost his crypto-convert zeal. He continues to hold the view that crypto products and blockchain technology will ultimately foster better products than those currently used by the financial sector.

Big technological shifts always bring frauds and doubters, Scaramucci says, but eventually “better products typically get adopted”.

“I think that probably slowed the forward progress and slowed the future. But I still think the future is coming.”

What the industry needs now, Scaramucci says, is collaboration between crypto founders and regulators to build trust in the sector.

“The crypto industry has learned why we have banking regulation. We need regulation. You can set things up without guardrails and do a lot of damage.”

Indeed. But what crypto surely also needs now is less of the sort of hyperbole that advocates such as Scaramucci have indulged in.

At the Financial Review crypto Summit, Scaramucci happily predicted bitcoin would go to $US500,000. On Tuesday night, he lumped bitcoin doubters in with those who dismissed the motor car or the internet.

Surely we’re beyond this cartoonish stuff now. Regulation will help rebuild confidence in the crypto sector, but its leaders need to start remaking the case that the technology has a utility beyond speculation and financial engineering.

FTX
Comments

All Comments

Recommended for you

  • BTC breaks through $69,000

     market shows BTC breaking through $69,000, currently at $69,039, with a 24-hour increase of 3.96%. The market is highly volatile, please manage your risk accordingly.

  • The "BTC OG Insider Whale" deposited another 69.08 million USDT into a Binance deposit address associated with Yi Lihua.

    according to on-chain analyst Ai Yi (@ai_9684xtpa), the "BTC OG insider whale" has deposited 69.08 million USDT into a Binance deposit address associated with Yili Hua. In the past 11 hours, a total of 10,000 ETH and 69.08 million USDT have been transferred in, with a total value of 89.47 million USD.

  • BTC falls below $69,000

    the market shows BTC falling below $69,000, currently at $68,957.16, with a 24-hour increase of 5.84%. The market is highly volatile, please manage your risk accordingly.

  • ETH breaks $2,000

    the market shows ETH breaking through $2000, currently at $2000.7, with a 24-hour decline of 3.93%. The market is highly volatile, please manage your risk accordingly.

  • BTC breaks through $68,000

    the market shows BTC breaking through $68,000, currently at $68,000.01, with a 24-hour decline of 3.33%. The market is highly volatile, please manage your risk accordingly.

  • BTC breaks through $67,000

    the market shows BTC breaking through $67,000, currently at $67,006.7, with a 24-hour decline of 3.83%. The market is highly volatile, please manage risk accordingly.

  • COINMY Named Title Sponsor of “The Silent Rise” Summit in Hong Kong on February 9

    According to CoinTime, COINMY has been confirmed as the title sponsor of “The Silent Rise” summit, taking place in Hong Kong on February 9. COINMY (CMY) is a globally compliant digital asset exchange focused on bridging traditional payment systems with the crypto ecosystem, with an emphasis on transparency, security, and efficient global trading infrastructure. “The Silent Rise” is a themed summit co-hosted by RWAX, METASTONE, ChainTimes, and other ecosystem partners, with sponsorship support from CoinMy, Nexus Chain, and several more Web3 projects. The event will be held from 14:00 to 22:00 on February 9 at the 28th floor of Crowne Plaza Hong Kong Causeway Bay, and is positioned as one of the most anticipated side events during Consensus Hong Kong 2026. The summit will feature multiple roundtable discussions covering key themes such as AI, Real-World Assets (RWA), and next-generation financial systems. The summit brings more than 20 prominent speakers to explore emerging trends, system design, and the evolving architecture of Web3.

  • Cardano founder: Over $3 billion lost in the crypto space

    On February 6, Cardano founder Charles Hoskinson revealed in a live broadcast that despite losing more than 3 billion US dollars in the crypto field, he still chooses to stay in the industry rather than quit. In response to external comments that he can afford the losses because he is wealthy, he said: "If you think I am in this business for the money, you are completely wrong — even if I lose everything, I will not stop."

  • Tether makes a $100 million strategic equity investment in Anchorage Digital

    Tether announced a $100 million strategic equity investment in Anchorage Digital. Anchorage Digital Bank N.A. is the first federally regulated digital asset bank in the United States, providing staking, custody, governance, settlement, and stablecoin issuance services to global institutions and innovators to promote the shared goal of advancing the next phase of digital asset applications.

  • ETH falls below $2100

    the market shows ETH fell below $2100, currently at $2099.68, with a 24-hour decline of 7.97%. The market is highly volatile, please manage your risk accordingly.