- Bloomberg reported that FTX CEO Sam Bankman-Fred lost 94% of his fortune on Tuesday.
- This represents the largest single-day drop in a billionaire's net worth relative to his total net worth.
- Bloomberg estimates that Bankmanfried's two largest assets are now worth $1 each.
FTX CEO Sam Bankman-Fried, who had an estimated net worth of $16 billion earlier this week, saw his net worth drop 94% to $1 billion on Tuesday. According to Bloomberg, this is the largest fortune collapse faced by a billionaire in a single day.
On Tuesday, the 30-year-old CEO announced the sale of his cryptocurrency exchange FTX to rival Binance to alleviate a severe liquidity crunch. Bloomberg reported that Bankman-Fried's 53 percent stake in FTX was valued at $6.2 billion, with another $7.4 billion of his fortune coming from his cryptocurrency trading house Alameda Research.
With Binance's acquisition of FTX, the Bloomberg Welfare Index now values FTX and Alameda at $1 each, excluding the implied value of Bankman-Fried's largest holding.
Sudden losses of this magnitude are common among the world's richest people, but a billionaire has never lost such a large percentage of his fortune in one day. Meta founder Mark Zuckerberg lost $29 billion on Feb. 3, but his net worth that day is still estimated at $84.3 billion.
In November 2021, Tesla CEO Elon Musk lost $50 billion in two days while interviewing Twitter users about the opportunity to sell his 10% stake in his automaker, but by the end of the week he had the richest man in the world.
Similarly, Amazon founder Jeff Bezos maintained his position as the world's second-richest person in 2019, despite his $36 billion drop in fortune overnight when he divested 25% of his assets. Amazon shares divorce details with ex-wife Mackenzie Scott.
The billionaire close to the new Bankman-Fried record is trader Bill Hwang, who lost his $20 billion fortune in two days in March 2021 after his firm Archegos Capital Management defaulted on loans. The Justice Department subsequently indicted Hwang on 11 criminal charges, including fraud, while prosecutors accused him of inflating his wallet to get more bank loans. He and his former CFO have pleaded not guilty to the charges.
Bankman-Fried's losses come after the cryptocurrency's devastating $600 billion drop this year. Changpeng Zhao, founder of Binance, the cryptocurrency exchange acquired by FTX, has lost $79.4 billion of his fortune in the crash this year, according to the Bloomberg Billionaires Index.