Until a few weeks ago, entrepreneur Samuel Bankman-Fried was the shining golden boy of crypto exchanges, with a fortune estimated at over 20 billion US dollars, and he had a big deal with Riot Games running, who distribute his favorite game League of Legends . But all of that changed in the last few weeks. In a filing to the court, it now sounds like Riot Games wishes Sam Bankman-Fried had never discovered LoL for himself.
How did the man become so rich?
- Sam Bankman-Fried started as an intern in 2013 at a company that trades financial instruments and fully joined after graduating from MIT. In the following years, he made a fortune with stock trading.
- In 2019, he founded the crypto exchange FTX, and his fortune grew to 26 billion US dollars during that time.
- He was regarded as a visionary, someone who truly understood the big hype topic “crypto”.
Company of crypto genius enters million-dollar deals with TSM and LCS
What does he have to do with League of Legends? Sam Bankman-Fried referred to LoL as his favorite hobby. He said he spent much more time on it than one would expect from someone who regularly prefers to work instead of sleep.
It was said that he closed huge deals and sold investors his visions while he was actually playing LoL. Although he wasn’t that good at LoL, still.
His enthusiasm for LoL also became part of his business when he made a big deal with the LoL team TSM in June 2021: Since then, TSM has appeared as “TSM FTX”.
In August 2022, he also closed a massive deal with Riot Games worth 96 million US dollars. His crypto exchange FTX became a sponsor of LoL’s US League LCS: Over 12.5 million $ were to flow into Riot Games’ coffers every year. However, only the first installment of 6.25 million $ was paid.
Life and wealth of crypto genius collapses within days
What went wrong? In November 2022, the life and wealth of Sam Bankman-Fried collapsed. On a single day in November, on 8.11.2022, FTX got into serious trouble: As investor confidence in the crypto exchange faded, 94% of Sam Bankman-Fried’s wealth also disappeared into thin air.
In the weeks that followed, it became clear that the crypto exchange had been operating with unscrupulous business practices. FTX filed for bankruptcy.
On December 12, 2022, Sam Bankman-Fried was arrested in the Bahamas.
“Monetary and non-monetary damage occurred”
This is how Riot Games reacts now: Riot Games has now detailed their view of things in a 22-page filing to the bankruptcy court in Delaware (via courtlistener).
They see themselves severely harmed by the fact that Sam Bankman-Fried was seen as so closely associated with his favorite game League of Legends and say that they have suffered “monetary and non-monetary damages”:
Before and during the media firestorm, Riot’s image and reputation with the customer base were inextricably linked to FTX through the former CEO Mr. Bankman-Fried. Media companies and Twitter commentators spread the image of Mr. Bankman-Fried playing League of Legends – the game from Riot Games – at the same time FTX was going under.
Mr. Bankman-Fried is famous for his dedication to the game. It is well known among investors that he played LoL during meetings.
Riot Games lists in detail the collapse of FTX and the mistakes of Sam Bankman-Fried over 22 pages.
Meanwhile, they emphasize their own high moral standards and mention a clause that allows Riot Games to terminate such contracts in case of moral wrongdoing.
These images created a public narrative that Mr. Bankman-Fried’s interest in League of Legends, once seen as human and relatable, was now irresponsible and juvenile. Articles that described the situation as a “hellscape” contributed to the public disgust for FTX.
Apparently, Riot is now also planning to quickly get out of the deal because they intend to close a deal with another crypto exchange, and FTX currently blocks that spot.
From the idea that FTX could stick to the lucrative deal, Riot Games has long given up. And apparently, they would have preferred to have had nothing to do with Sam Bankman-Fried in recent weeks.
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