During testimony before the House Financial Services Committee on December 13, John Ray III, the newly appointed CEO of bankrupt crypto exchange FTX, told members of Congress that FTX U.S. had 2.7 million user accounts while FTX International had 7.6 million user accounts. That’s a total of 10.3 million potential customers of FTX that may have been bilked out of some or all of their funds by the alleged mastermind, Sam Bankman-Fried, and his co-conspirators. That’s more than 250 times the defrauded customers of Ponzi mastermind Bernie Madoff.
While Ray acknowledged that some FTX users had multiple accounts, even if you cut the 10.3 million user accounts by as much as two-thirds, 3.4 million accounts is still 85 times the number of Madoff victims.
If you throw into the mix that Madoff acquired his victims over more than four decades and Sam Bankman-Fried’s FTX has been in operation for less than four years, the scope of the number of people impacted is stunning. And if one considers the customer losses at other crypto companies that have filed bankruptcy, potentially as a result of their exposure to FTX, the total dollar amount of losses may come close to or even exceed the estimated $17.8 billion of lost principal in the Madoff fraud.