Shark Tank’s Kevin O’Leary Wanted To Help FTX
- Kevin O’Leary said that he was approached by several sovereign wealth funds and pension funds as they wanted him to help FTX bridge the $8 billion gap in its balance sheet.
- While the millionaire wanted to help Sam Bankman-Fried when the latter contacted him a day prior to filing for bankruptcy, statements from SEC Chair Gary Gensler prevented him from doing so.
- Gensler believes that the crypto sector is “significantly non-compliant” and as a result, additional regulatory rules must be implemented to protect the investors’ funds.
Shark Tank’s popular investor “Mr. Wonderful,” Kevin O’Leary, was a former ambassador and paid spokesperson for the now-bankrupt crypto exchange FTX when it was under the leadership of its founder Sam Bankman-Fried. Upon the request of many, the millionaire decided to bail out the Bahamas-based firm but went back on his words after a distrubing statement from the Chairman of Securities and Exchange Commission (SEC), Gary Gensler.
In an interview, O’Leary stated that he was approached by Bankman-Fried a day before FTX filed for bankruptcy and the former crypto billionaire whose net worth plunged to zero, asked the prominent businessman to throw a lifeline to his dying firm. Initially, O’Leary thought that it would a good idea to bailout the exchange and create a strong footing in the crypto industry.
“That’s the kind of money that an institution or a sovereign wealth fund can put to work if they thought there was an interesting opportunity,” O’Leary said. “In financial services, liquidity events like this can be interesting investment opportunities if you think it’s a legitimate investment and it’s not an issue with the regulator.”
As per O’Leary, there were several sovereign wealth funds and pension funds which contacted him and asked him to help FTX bridge the $8 billion gap in its balance sheet.
Kevin O’Leary drops the idea
While Kevin O’Leary thought of investing in FTX, he dropped the idea following a significant statement from SEC Chair Gary Gensler who stated that the crypto sector is “significantly non-compliant” and as a result, additional regulatory rules must be implemented to protect the investors’ funds. This was a huge red flag for the businessman because he knew that investing in FTX would involved a lot of regulatory pushback.
“The minute that occurred, that was the end of any sovereign wealth fund’s interest,” O’Leary said. “There was no way to get that $8 billion onto the balance sheet of FTX with regulators hovering overhead.”
Mr. Wonderful’s role at FTX
Kevin O’Leary used to be one of the biggest backers of FTX crypto exchange and on many occassions, said that Sam Bankman-Fried should be trusted since his both parents were from legal/political background. As a result, he became a major part of the exchange in August 2021 in a deal wherein he received the firm’s stocks and was paid in crypto for being the ambassador and spokesperson at the exchange.
“FTX leverages best-in-class tech to provide a quality trading experience with low fees for both professional and retail investors alike, while at the same time providing the reporting platform that serves both internal and regulatory compliance requirements,” said Kevin O’Leary while touting the services of FTX.