Pablo Torre Finds Out
How Sam Bankman-Fried Sportswashed an $8 Billion Crypto Fraud, Starring Tom Brady and Steph Curry
Thu, 02 Jan 2025
The FTX founder was a "martian" to the sports world. Why did he spend so much on arena naming rights and superstar endorsements? And how the hell did SBF become friends with TB12? Authors Michael Lewis (Going Infinite) and Zeke Faux (Number Go Up) witnessed the rise and fall of a crypto king. Now we can do the postmortem: “Moneyball, on steroids, gone wrong.” This episode originally aired November 21, 2023. Learn more about your ad choices. Visit podcastchoices.com/adchoices
Chapter 1: What is the story behind Sam Bankman-Fried and FTX?
It put him on the cover of Fortune as the next Warren Buffett and Forbes as the next Mark Zuckerberg. And it put him all over sports itself. You may remember this. FTX had a Super Bowl commercial. Sam was famously endorsed by Tom Brady, Steph Curry and Shohei Ohtani and many of the best athletes in America. all of which turned out to be an enormous problem.
One of the most powerful people in the cryptocurrency industry, Sam Bankman-Fried, arrested overnight in the Bahamas. The federal charges just unsealed. They include eight counts, including wire fraud, securities fraud, and intent to defraud the United States government.
The government also contends that Bankman-Fried was using these customer deposits to both cover bad bets that he made at his crypto hedge fund, Alameda Research, and to make $100 million in campaign contributions. All in, we're talking about more than $8 billion worth of FTX customer money that went missing. Bankman-Fried has pleaded not guilty to all charges.
This is always sort of a gamble, right? The defendant taking the stand in their own trial, the defense putting him up there. How's he doing so far?
poorly to really poorly. A jury has found FTX founder Sam Bankman-Fried guilty. Guilty. Guilty on all seven counts against him.
Yeah, f***ing insane. That trial was this month, by the way, not so far from our office here in New York. And it did feel like one minute Sam Bankman Freed was the good guy in charge of our entire technological future. And the next minute he was in jail. And all of this was humiliating for sports for many reasons.
Like this next video, which I just had to show to producer Ryan Cordes, which is from June 2021.
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Chapter 2: How did celebrity endorsements impact FTX?
It's official. The home of the Miami Heat is now FTX Arena. The name was formally converted at an event at the arena just a short time ago. The name will stick around for the next 19 years. Officials with FTX say today marks the start of a new era. A new era.
What an era. Do you remember that era? It looked like the celebration for the big three with the heat. I don't know why there was so much confetti.
Yeah, yeah, yeah. It was them saying, not 17, not 18, 19. 19 years. That's right. It lasted 19 months, dude. Well, they got one number right. You got to give them that, bro. So FTX, that crypto exchange, is Sam Bankman Freed's company, right? This was Mr. FTX. This was Mr. Miami Heat.
And that deal was supposed to be worth $135 million over the 19-year span between Sam Bankman Freed and FTX and Miami-Dade County. Yeah, make that clarification. It was the county, not the heat. Except the heat also annually, we're going to be making $2 million a year. Oh.
And so all of the optimism of that confetti, it made me think about who we know who might have been there when all of this was going down. And of course, we found someone.
Dude, of course, you know I watch every single Heat game. And my boy, Will Manso, my boy, one of the best reporters in the country. I remember he interviewed Sam Aikman-Fried one time on a game.
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Chapter 3: What led to Sam Bankman-Fried's arrest?
Yes. Will Manso, in-arena reporter for the Miami Heat, was right there courtside with the man in question.
Chapter 4: How did FTX's branding strategy involve sports?
That morning I get up. As normal, my producer sends me an email for the Heat show that night and says, hey, you're interviewing this guy, Sam Bankert-Fried. He's the founder, the owner, the CEO, whatever you want to call it, of FTX. And the arena being FTX, tonight's a big opening night. It's going to be all in Miami shirts everywhere. Everybody's going to be excited.
So you need to interview this guy. So I get there and I get to the seat and I see him standing there. But what I see is this man in like a dark t-shirt, sort of a black t-shirt, cargo shorts. His hair is much more disheveled than I saw in the pictures. Like I knew he had big hair, but I mean, it's everywhere. And it just looks like it hasn't gotten combed in two weeks.
I walk over and the handler comes, hey, Will, how are you? And I'm like, okay, this is really him. And he's standing there and he's kind of unassuming, quiet. He goes, hey, how are you? And I shake his hand. He's hand-baked my food. I said, hey, Will Manso.
And Pablo, I kid you not, the first thing I notice is right here on his shirt, along the shirt, is what appears to be the world's largest toothpaste stain. Like he was brushing his teeth in the morning, the big chunk of toothpaste fell. He didn't know what to do, so he blabbed it on and scrubbed it. And that's the way he kept the shirt on.
His shorts look like they're never been washed or ironed, fixed. I mean, he looked like he just got out of bed.
That's insane to leave the house like that, bro.
Well, this is where Will Manso ends up being not just a good reporter, but a good guy because he has a solution to this completely incomprehensible problem.
So by luck that day, or by luck or by chance, by whatever, that day, every seat in the arena had a, you in Miami, the FTX slogan, T-shirt on the seat. So we go back to him and not to tell him that, hey, you look like a vagabond and you look terrible with this on your shirt. We say like, hey, these shirts are so cool. They're everywhere. Everybody's wearing them. Why don't you wear it?
You're the CEO of the company. And he was like, oh, awesome. That's a great idea.
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Chapter 5: What happened at the Miami Heat's opening night with FTX?
so they come to me hey will manso standing by with the ceo of ftx who's so excited to be here courtside for his first heat game and we're here courtside with the ceo of ftx sam bankman free kind of looks to join us here on this opening night you will notice that he has the shirt and you can see the outline of another shirt under that's the original toothpaste shirt you're
watching the Heat in a big game opening night with an arena with your company name on it. What's that like?
Chapter 6: What was the significance of the FTX Arena naming rights?
It's really cool. I mean, just seeing everything from the courtside logo and the logos ever, the flames coming out, being right next to the players, it's really exciting.
In the moment, he seemed like the sweet, unassuming, like you almost liked him because he was just so like not like Joe Cool or like trying to be like whatever. I do this all the time.
I mean, it's unbelievably cool and exciting. Just the enthusiasm and support that we've gotten from the team, from the club, from the fans and from the city here has been has just been great. And we're really excited to work with him.
That shirt is immense. I can't believe how big the shirt is. And the shame is immense. Will Banzo is a good reporter. This is not the clip I would submit to the Pulitzer Committee because I have been texting this photo of Will and Sam Begman-Fried in giant ass shirt.
Do you know how bad the stain has to be for him to agree to wear a 4X shirt? Absolutely. Like it has to be a huge f***.
It's a stain that is only rivaled by the stain upon the entire institution of Miami and the heat. How dare you? The only defense I can offer you here as the minister of heat propaganda is that you guys, it turned out, were not alone. in this shame because Cortez, I've spent weeks now. You've seen me walk around this office with two books. I spent weeks studying this story.
And my theory after all of this is that this whole thing is actually a sports story. As much as we talk about the Saudi Arabian government using soccer and golf and FIFA, all of these sports to hide its morally reprehensible behavior, right? Sports washing. To me, the ultimate example of a foreign entity using sports to hide and to normalize its behavior is actually Sam Bankman-Fried in FTX.
I believe that this is a sports washing story. And so what I did, I've been reading these two books by Zeke Fox and Michael Lewis, respectively, Number Go Up and Going Infinite, all about Sam Bankman-Fried in FTX and their people, authors who got access to him, who were around while all of this was happening.
And what I wanted to do on today's show is actually pressure test my theory that this story is a sports washing story. This is a sports story to the core. And I needed both Zeke Fox and Michael Lewis to tell me whether they approve of my logic here. And also, who else beyond just you should be absolutely humiliated by this entire thing?
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Chapter 7: How did sports serve as a platform for crypto normalization?
Because of the guilt that you have, clearly.
No, I have zero guilt about the dark triad, about how you're a narcissist because you turned this entire fascinating episode into about Pablo Torre and Pablo Torre's theory.
Well, it is my show. And also, I want to find out if I'm the one person who might be right about a scandal that pretty much everybody else missed. Okay, great. Hey. Hello. Hello. Are you in Miami? I'm in New York. I'm in New York, a satellite of the Dan Lebitard empire.
But I want to say, Michael, first off, I have some specific questions that may feel disjointed in a sense, but I promise that they are targeted to things in your book that I just found really fascinating as regards sports. So thank you for doing this.
This is just one big trust fall.
I'm in your hands. Let's do what you want to do. Okay, so I do want to explain what I want to do here, because that is Michael Lewis, maybe the most successful nonfiction author of our time, the author of Moneyball and The Big Short, and now Going Infinite, the rise and fall of a new tycoon. No writer... spent more time over about two years getting to know Sam Bankman Freed than Michael.
And this generated some amount of controversy because, you know, Sam Bankman Freed is in jail. So I got lots of one-on-one questions from Michael about all of that. But what I also wanted to do here was consult the other writer who was all over this story, a really smart investigative reporter named Zeke Foxx.
This is the most legit podcast that I've been on.
Not quite a Bahamas conference with Tony Blair. Zeke's book about Sam Bankman Freed, which is called Number Go Up, Inside Crypto's Wild Rise and Staggering Fall, which mentions that conference with Tony Blair, by the way, is also really good, in my opinion. It's different from Michael's book. It's a competitor to Michael's book. but it's quite good.
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Chapter 8: What lessons can be learned from the FTX debacle?
Oh, jeez. I mean, I've got some time from like 8.30 or 9 a.m., I think. I've got kind of back-to-back meetings until then.
This was a kid who, when he was like 19, when, by the way, he's at MIT. He has a Nate Silver-ish blog where he writes about baseball stats. Genuinely does like sports. Oh, I didn't know that. Yeah. You might have thought he was just like a nerd who doesn't like sports and does it cynically, but he actually, he was a fan.
And he starts to just kind of, from first principles, look at what people care about. And he saw that, like, in Europe, when you put the names of companies on the jerseys of players, everybody noticed the name of the company. And no one cared about the names that were on the stadiums.
But in the United States, all the announcers, every time they talk about a stadium, they mention the Mercedes-Benz Superdome.
And again, welcome back to the Mercedes-Benz Superdome. And...
He just picked it up. It was like what people cared about. He would never try to make an argument about why people were this way because he had no idea. It was just, I'm looking at these strange creatures called human beings, and this is what they do here in America.
Look, where are the places that have huge amounts of following, that have lots of people care about, that are universal? to partner with us. And I think that we're open to a lot of areas, but in practice, sports has been a lot of that.
He said, it had been my impression that the names of stadiums of professional sports teams in America, particularly baseball, football and basketball teams, were very widely known. I, as a somewhat average level sports fan, could name dozens of stadium names, almost all of which I had never been to.
Once Sam has decided that what they need to do is stick FTX's name on a stadium, they go looking for a stadium to stick its name on. And he got rejected by the New Orleans Saints and the Kansas City Chiefs. And I think it was because crypto just generally made some people uncomfortable, rightly.
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