Stanford University is returning millions of dollars in donations it received from bankrupt crypto exchange platform FTX, after it was revealed that the company’s founder Sam Bankman-Fried is a scammer.
Bankman-Fried is accused of defrauding investors and mishandling billions of dollars worth of customer funds. He is currently awaiting trial, and if convicted, he faces decades behind bars.
Stanford University received the donations from FTX and FTX-related entities for “pandemic-related prevention and research.” However, in light of the allegations against Bankman-Fried, the university has decided to return the money.
“We have been in discussions with attorneys for the FTX debtors to recover these gifts and we will be returning the funds in their entirety,” a Stanford spokesperson said in an email to Bloomberg.
The decision to return the money is a welcome one for the victims of FTX’s collapse. Many of these victims lost their life savings in the scam, and they are now struggling to get their money back.
Stanford University’s decision to return the money is a good example of how institutions can take a stand against fraud and corruption. It is also a reminder that even the most prestigious institutions can be fooled by scammers.
In addition to the donations to Stanford University, FTX also made donations to a number of other organizations, including:
- MIT Media Lab
- UC Berkeley School of Law
- University of Chicago
- Tsinghua University
- Future Fund
- Center for Effective Altruism
The press has been critical of FTX’s donations, given the allegations against Sam Bankman-Fried. Some have accused the company of trying to buy influence and legitimize its business practices. Others have expressed concern that the donations will be used to further Bankman-Fried’s own interests, rather than the good of the causes they were supposedly intended to support.
For example, a New York Times article from January 2023 titled “FTX Spent Millions to Buy Influence, Raising Concerns About Ethics” stated that the company’s donations were “part of a broader effort to build relationships with powerful people and organizations, and to influence public policy in its favor.”
A Washington Post article from February 2023 titled “FTX’s Donations to Think Tanks Are Now Under Scrutiny” stated that the company’s donations to think tanks “raised questions about whether the organization was trying to buy influence in Washington.”
In light of the allegations against Bankman-Fried, some of the organizations that received donations from FTX are now reviewing their policies on accepting donations from cryptocurrency companies. For example, MIT Media Lab announced in January 2023 that it would be suspending its cryptocurrency donation program until it could complete a review of its policies.
It remains to be seen what the long-term impact of the FTX scandal will be on the cryptocurrency industry. However, it is clear that the scandal has raised concerns about the ethics of cryptocurrency companies and their donations.