Binance’s chief strategy officer said it took his company two hours of due diligence on FTX to determine that Sam Bankman-Fried’s crypto exchange was beyond saving.
“It was like a bomb went off in that place,” Patrick Hillmann, Binance CSO, told CNBC on Thursday. “You know, we’re getting on calls, people are crying. … It was complete pandemonium over there,” Hillmann said, adding that when “Sam went completely silent on them, the entire organization just fell to pieces.”
FTX’s spectacular collapse last week was first made apparent when Binance, the world’s largest exchange for cryptocurrencies, said on Nov. 8 that it signed a nonbinding agreement to acquire its smaller rival for an undisclosed sum. FTX was in the midst of a liquidity crunch, with customers demanding billions of dollars in withdrawals a day. It was money that FTX didn’t have, because it was using client deposits for other purposes.
Binance technically had 30 days to explore a deal, but the next day it backed out of the rescue plan, saying in a statement that FTX’s “issues are beyond our control or ability to help.” As one of FTX’s first investors, Binance knew the company well.
“Somehow they were always spending more and more and more and more money,” Hillmann said. “We never understood where the money was coming from. It just never made any sense to us.”
FTX’s lavish expenses included a $135 million deal for the naming rights to the arena of the NBA’s Miami Heat, a Super Bowl ad featuring comedian Larry David and sponsorship of Formula One.
“For us, if there’s smoke there’s probably fire,” Hillmann said. “I don’t think we ever even could have come close to realizing exactly how hot the fire was burning inside.”
Hillmann said lawmakers and venture capitalists were apparently drawn in by Bankman-Fried’s persona and appearance of credibility. He said the FTX founder was either like Theranos’ Elizabeth Holmes, who Hillmann said was “completely delusional,” or Bernie Madoff, who was “manipulative” and created a “cult of personality.”
“There’s no middle ground,” Hillmann said. “It’s one of the two.”
CNBC reached out to FTX, which had no response to Binance’s accusations. Bankman-Fried, who resigned from the company and was replaced as CEO by restructuring expert John Ray III, says he’s still trying to reach a financing deal in a way that can help depositors.
Ray, who was in charge of restructuring Enron, slammed FTX Thursday morning in a filing with the U.S. Bankruptcy Court for the District of Delaware, saying in his 40 years in the business he’s never seen “such a complete failure of corporate controls.” FTX said Bankman-Fried no longer speaks for the company.
Hillmann said that early on there were some concerns with FTX and its unsavory relationship with Alameda Research, Bankman-Fried’s hedge fund. However, the company had raised money at a $32 billion valuation from prominent investors, and Bankman-Fried made multiple trips to Washington, D.C., to testify in front of lawmakers. He was also a major contributor to Democratic political campaigns, while another executive, Ryan Salame, was a big Republican donor.
“We would just assume that because the scale and level of engagement they have with some of the most powerful people on this planet, that those checks and balances just naturally have to be there for those individuals to agree to be a part of their work,” Hillmann said.
Apple is losing market share in China due to declining iPhone shipments, supply chain analyst Ming-Chi Kuo wrote in a report on Friday. The stock slid 2.4%.
“Apple has adopted a cautious stance when discussing 2025 iPhone production plans with key suppliers,” Kuo, an analyst at TF Securities, wrote in the post. He added that despite the expected launch of the new iPhone SE 4, shipments are expected to decline 6% year over year for the first half of 2025.
Kuo expects Apple’s market share to continue to slide, as two of the coming iPhones are so thin that they likely will only support eSIM, which the Chinese market currently does not promote.
“These two models could face shipping momentum challenges unless their design is modified,” he wrote.
Kuo wrote that in December, overall smartphone shipments in China were flat from a year earlier, but iPhone shipments dropped 10% to 12%.
There is also “no evidence” that Apple Intelligence, the company’s on-device artificial intelligence offering, is driving hardware upgrades or services revenue, according to Kuo. He wrote that the feature “has not boosted iPhone replacement demand,” according to a supply chain survey he conducted, and added that in his view, the feature’s appeal “has significantly declined compared to cloud-based AI services, which have advanced rapidly in subsequent months.”
Apple’s estimated iPhone shipments total about 220 million units for 2024 and between about 220 million and 225 million for this year, Kuo wrote. That is “below the market consensus of 240 million or more,” he wrote.
Apple did not immediately respond to CNBC’s request for comment.
Amazon said it is halting some of its diversity and inclusion initiatives, joining a growing list of major corporations that have made similar moves in the face of increasing public and legal scrutiny.
In a Dec. 16 internal note to staffers that was obtained by CNBC, Candi Castleberry, Amazon’s VP of inclusive experiences and technology, said the company was in the process of “winding down outdated programs and materials” as part of a broader review of hundreds of initiatives.
“Rather than have individual groups build programs, we are focusing on programs with proven outcomes — and we also aim to foster a more truly inclusive culture,” Castleberry wrote in the note, which was first reported by Bloomberg.
Castleberry’s memo doesn’t say which programs the company is dropping as a result of its review. The company typically releases annual data on the racial and gender makeup of its workforce, and it also operates Black, LGBTQ+, indigenous and veteran employee resource groups, among others.
In 2020, Amazon set a goal of doubling the number of Black employees in vice president and director roles. It announced the same goal in 2021 and also pledged to hire 30% more Black employees for product manager, engineer and other corporate roles.
Meta on Friday made a similar retreat from its diversity, equity and inclusion initiatives. The social media company said it’s ending its approach of considering qualified candidates from underrepresented groups for open roles and its equity and inclusion training programs. The decision drew backlash from Meta employees, including one staffer who wrote, “If you don’t stand by your principles when things get difficult, they aren’t values. They’re hobbies.”
Amazon, which is the nation’s second-largest private employer behind Walmart, also recently made changes to its “Our Positions” webpage, which lays out the company’s stance on a variety of policy issues. Previously, there were separate sections dedicated to “Equity for Black people,” “Diversity, equity and inclusion” and “LGBTQ+ rights,” according to records from the Internet Archive’s Wayback Machine.
The current webpage has streamlined those sections into a single paragraph. The section says that Amazon believes in creating a diverse and inclusive company and that inequitable treatment of anyone is unacceptable. The Information earlier reported the changes.
Amazon spokesperson Kelly Nantel told CNBC in a statement: “We update this page from time to time to ensure that it reflects updates we’ve made to various programs and positions.”
Read the full memo from Amazon’s Castleberry:
Team,
As we head toward the end of the year, I want to give another update on the work we’ve been doing around representation and inclusion.
As a large, global company that operates in different countries and industries, we serve hundreds of millions of customers from a range of backgrounds and globally diverse communities. To serve them effectively, we need millions of employees and partners that reflect our customers and communities. We strive to be representative of those customers and build a culture that’s inclusive for everyone.
In the last few years we took a new approach, reviewing hundreds of programs across the company, using science to evaluate their effectiveness, impact, and ROI — identifying the ones we believed should continue. Each one of these addresses a specific disparity, and is designed to end when that disparity is eliminated. In parallel, we worked to unify employee groups together under one umbrella, and build programs that are open to all. Rather than have individual groups build programs, we are focusing on programs with proven outcomes — and we also aim to foster a more truly inclusive culture. You can read more about this on our Together at Amazon page on A to Z.
This approach — where we move away from programs that were separate from our existing processes, and instead integrating our work into existing processes so they become durable — is the evolution to “built in” and “born inclusive,” instead of “bolted on.” As part of this evolution, we’ve been winding down outdated programs and materials, and we’re aiming to complete that by the end of 2024. We also know there will always be individuals or teams who continue to do well-intentioned things that don’t align with our company-wide approach, and we might not always see those right away. But we’ll keep at it.
We’ll continue to share ongoing updates, and appreciate your hard work in driving this progress. We believe this is important work, so we’ll keep investing in programs that help us reflect those audiences, help employees grow, thrive, and connect, and we remain dedicated to delivering inclusive experiences for customers, employees, and communities around the world.
New Tesla Model 3 vehicles on a truck at a logistics drop zone in Seattle, Washington, on Aug. 22, 2024.
M. Scott Brauer | Bloomberg | Getty Images
Tesla is voluntarily recalling about 239,000 of its electric vehicles in the U.S. to fix an issue that can cause its rearview cameras to fail, the company disclosed in filings posted Friday to the National Highway Traffic Safety Administration’s website.
“A rearview camera that does not display an image reduces the driver’s rear view, increasing the risk of a crash,” Tesla wrote in a letter to the regulator. The recall applies to Tesla’s 2024-2025 Model 3 and Model S sedans, and to its 2023-2025 Model X and Model Y SUVs.
The company also said in the acknowledgement letter that it has already “released an over-the-air (OTA) software update, free of charge” that can fix some of the vehicles’ camera issues.
In 2024, Tesla issued 16 recalls in the U.S. that applied to 5.14 million of its EVs, according to NHTSA data. The recall remedies included a mix of over-the-air software updates and parts replacements. More than 40% of last year’s recalls pertained to issues with the newest vehicle in the company’s lineup, the Cybertruck, an angular steel pickup that Tesla began delivering to customers in late 2023.
Regarding the latest recall, the company said it had received 887 warranty claims and dozens of field reports but told the NHTSA that it was not aware of any injurious, fatal or other collisions resulting from the rearview camera failures.
Other customers with vehicles that “experienced a circuit board failure or stress that may lead to a circuit board failure,” which cause the backup camera failures, can have their vehicles’ computers replaced by Tesla, free of charge, the company said.
Tesla did not immediately respond to CNBC’s request for comment.