Last week, the sudden collapse of FTX gave rise to many conspiracy theories that sought to tie the disgraced CEO Sam Bankman-Fried to US Democratic elites and, more broadly, the collective “deep state.” Accusations against SBF ranged from allegations of running a global pedophile ring in the Bahamas to being a CIA plot to take down the crypto industry, but one particularly stood out — namely that FTX was a front to launder Ukraine donation money to Democratic candidates.
Unlike the other two theories, the Ukraine version of the FTX conspiracy actually made it to the mainstream media — it was discussed on Fox News’ Tucker Carlson Tonight on Monday, as Miranda Devine, the New York Post columnist and Fox News contributor, questioned why the besieged nation was “dabbling with cryptocurrency.”
"Why on earth the American taxpayer is funneling tens of billions of dollars over to Ukraine so that they can fight Russia, and why on earth they would be involved, the Ukrainian government, with this now collapsed cryptocurrency exchange we need to know," Devine asked guest host Tulsi Gabbard.
Bankman-Fried was "indulging in all sorts of woke causes, including Ukraine," she added.
According to the conspiracy theory picked up by Fox News, the country used donated money to invest in FTX, which then sent it back to Democrats. The bankrupt exchange was an official partner of the Ukrainian government for the Aid For Ukraine crypto fundraising initiative, along with the Ukrainian exchange Kuna and staking platform Everstake.
A similar narrative, except for the Ukraine part, was pushed by Elon Musk, who repeatedly engaged with tweets suggesting that FTX was deliberately founded by Dems in 2019 to launder money for their candidates in the 2022 midterms.
Indeed, Sam Bankman-Fried was the second most-generous donor to the Democratic Party, topped only by George Soros. According to Forbes, he donated $40 million to several left-leaning Super PACs, along with $7.4 million from Nishad Singh, FTX Director of Engineering.
At the same time, it’s worth noting that FTX gave large sums of money to both sides of the U.S. political aisle — co-CEO Ryan Salame personally spent $23.9 million to support Republican candidates. And given SBF’s lobbying efforts in DC, it comes as no surprise that his crypto empire with feet of clay sought to win the support of both parties. Needless to say, the shy $40 million from the company valued at $40 billion didn’t have to come from the elaborate laundering scheme — Sam’s monthly pocket money most likely would be just as enough.
However, the said conspiracy theory generated so much buzz on social media that Ukraine’s deputy minister of digital transformation, Alex Bornyakov, felt compelled to refute the rumors.
“A fundraising crypto foundation @_AidForUkraine used @FTX_Official to convert crypto donations into fiat in March. Ukraine's gov never invested any funds into FTX. The whole narrative that Ukraine allegedly invested in FTX, who donated money to Democrats is nonsense, frankly," he tweeted on Monday, ending with a "facepalm" emoji.
As Aid For Ukraine clarified in a series of tweets, the fund used FTX exclusively as a fiat off-ramp in early March 2022, and store funds elsewhere.
“Every time russia is defeated on the battlefield, it starts looking for another way to cover up its military failures in the media by spreading fake news based on made-up assumptions,” Sergey Vasylchuk, CEO of Everstake and Aid For Ukraine co-founder, stated on Twitter.
“This time, they decided to use the FTX collapse to spin yet another tale about money laundering. It's obvious that Western support of Ukraine hurts russia as it leads to its losses on the battlefield. We know for a fact that every donation was spent for the benefit of Ukraine,” he added.