The infamous Canadian investor and Shark Tank star Kevin O’Leary spoke further about FTX’s collapse on Thursday, revealing the exact amount of money FTX paid him to promote their brand.
He also broke down how much money he lost within the exchange, and what the investor mentality surrounding the company was like prior to its collapse.
Kevin O’Leary’s FTX Deal
In conversation with CNBC on Thursday, O’Leary explained that institutional interest in FTX US equity was incredibly high when it was still solvent. Nevertheless, he refused to bring other parties aboard as Limited Partners given that he was a paid spokesperson for the company, meaning he didn’t lose any money inside the company that wasn’t his own.
When asked how much he was paid for the promotion, O’Leary said the deal worth roughly $15 million in total. That included funds for various agents he needed to pay, and $9.7 million in crypto investments, and $1 million in the company’s equity.
The investor has since lost all of those funds within FTX after his account got “scraped,” along with the relevant data.
“It was not a good investment,” he said. “I don’t make great investments all the time. Luckily, I make more good ones than bad ones, but that was a bad one.”
In August of 2021, O’Leary claimed that the now-defunct exchange met his own “rigorous standards” for regulatory compliance. In October of 2022, he publicly declared that FTX was one of the least likely places for investors to get in trouble.
Today, the exchange and its American arm have frozen user withdrawals, now facing a multi-billion dollar shortfall on customer deposits. In retrospect, O’Leary said he and other FTX investors now look like “idiots” who “relied on each other’s due diligence” and the company CEO’s seemingly trustworthy background when getting involved.
“Sam Bankman-Fried is an American. His parents are American compliance lawyers,” he said. “There were no other American, large exchanges to invest in if you wanted to invest in crypto as an infrastructure play.”
Where Did the Money Go?
Despite his losses, O’Leary said he is focused on figuring out where his and other customers’ money went at FTX. He claims to have been in talks with SBF over the matter, during which the ex-CEO revealed that much of FTX’s cash went towards buying back FTX equity from Binance.
The investor will also appear at a congressional hearing about FTX’s collapse next week, which House Financial Services Committee chair Maxine Waters has pressured. Bankman-Fried to attend.
O’Leary has previously defended Bankman-Fried, refusing to join a growing chorus of investors and industry leaders accusing him of fraud. Last month, he even suggested that he would still be willing to hire SBF onto one of his teams if he was dedicated to a strict asset trading role.
The investor last month said he believed Bankman Fried’s explanation about FTX’s collapse being an “embarrassing mistake,” for which he received immense backlash.
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