A Young Crypto-Billionaire’s Nascent Approach to Giving: 7 Questions for Sam Bankman-Fried

Sam Bankman-Fried, Founder of FTX

Editor’s Note: This article originally published August 31, 2021.

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Sam Bankman-Fried is the founder of FTX, a booming cryptocurrency trading platform—and a potential mega-philanthropist in the making. The 29-year-old MIT graduate and dedicated effective altruist estimates his net worth at $15 billion—and says he wants to give most of his fortune away. In late July, his company’s charitable arm, FTX Foundation, announced its first major program, FTX Climate (see IP’s coverage here). It was also the first public philanthropic move by Bankman-Fried, though he was one of President Joe Biden’s top donors in 2020.

I spoke with Bankman-Fried earlier this month to learn more about his thoughts on philanthropy and where his giving is headed. This conversation has been edited for clarity.

How did FTX Foundation and FTX Climate come about?

There are two pieces to it. When you look at the climate piece in particular, especially because of the discussion that was going on in the crypto community around the climate impact of proof-of-work currencies. We sort of felt that it was incumbent on us to do something, both to counteract the impact of blockchain transfers going in and out of FTX, but also to try to move the industry in the right direction. And also to try to show that this was a problem that could totally be counteracted and that this didn’t need to be a war between crypto and the environment, or anything like that.

One piece of that is buying carbon offsets to offset the direct impact of the blockchain transfers going through FTX. And separately from that, and because that is only going to go so far, giving some as well to places that are basically doing research on potential longer-term forms of massively either reducing carbon consumption in the first place or reducing or reversing the impacts of it. That’s where the climate piece in particular came from.

We want to set a precedent in the industry of giving back and make it easy for people to see what it’s like. Hopefully, it’s an example for some people. And also, [we] give the FTX community a voice in it.

Do you envision areas of focus other than climate for the FTX Foundation?

Definitely. Part of this is going to be reactive and responsive to what’s happening in the world, and oxygen for India was one example of that. But in the end, we want to be looking at things that can have real impact on the long-term trajectory of the world. That’s easier said than done. And I certainly don’t want to imply that that is easy to do. 

Pandemic preparedness would be one thing that we’d be excited to find great places to give. So hopefully, the next time something like COVID comes about, we can, as a world, handle it a little bit better than we did this time. Especially if an extremely deadly version comes along, and hopefully it never does, but that’s something that could have more existential prospects for the world.

To the extent that emerging technology can be sort of navigated in a positive direction in mitigating risks, that’s another potential one. Climate change is one example—it’s certainly one of the more already well-funded examples, relative to some of the others.

Just in general, I don’t think we’re going to do a perfect job of predicting what the future is, even the short-term future. Some of this is just going to have to be responsive to what we learn over the next few years. In addition, we are giving some to global poverty, to fighting malaria and other diseases in developing countries and any other causes that seem worthy. 

How did you choose the FTX Foundation’s grantees? 

In terms of where we’re giving, when you look at the climate-related ones, we had two high-level categories. One of them was looking at direct carbon offsets. One of the things we’re looking to do, to start off with, is to just directly offset the impact of our production-related actions. From that perspective, it was basically just doing research on which of the carbon offset places seemed most legitimate. 

The second piece of it was a lot more free-form and a lot more open. That was a lot more about looking at the arguments various places had for what their long-term impact was going to be. And how they were going to be moving the world closer to becoming carbon-neutral. There are a bunch of different ways to go about that, between looking at carbon removal programs, between looking at programs aimed at preventing carbon production in the first place and everything in between. So that one was a little bit more open. We tried to do a few in each category, as well, partially just because we want to learn, too, and we want to do the research to see how these go over time. And ultimately do what we can to figure out where the most efficient ways to help the environment are.

In a Q&A with Vox, you largely disagreed with the idea of trying to make money while doing good through your job. Doesn’t FTX Foundation equate to doing some good with your job? Do you see this as public relations, or have you changed your views?

I think that when you’re going to try to do good, you should really try to do good. That can happen through work. It absolutely can. I’m hoping that we will, both directly with our donations, and hopefully, by inspiring others, too. 

But I think that also means it's sort of incumbent on us to try to be efficient with this and try to do as much as we can with these donations at work. Otherwise, I do think it sort of runs into the issue that you’re referencing, which is that at some point, it’s easy to accidentally end up focusing on inefficient and not-very-impactful ways of doing good through work and consider that having done your duty, rather than figuring out what the most impactful way to do it is. But if what you’re doing to do good through work is really efficient and impactful, then I think that sort of side steps that worry.

You’ve said that you’re focused on making as much money as possible and giving it away in the most effective way possible. How do you determine the timing, i.e., when to hold and when to give?

The first thing is, I don’t think it’s obvious what the answer is. I think there are real arguments in both directions. The argument for giving now is, first of all, you might be able to build out systems that can sort of grow over time. Second of all, you might be able to sort of affect things that you can’t do retroactively. If you’re giving to something COVID-related, that sort of has to happen now.

On the other hand, there are these sort of arguments for saving and giving later. First of all, maybe you can grow that money through investments and then give more later. So then there’s this question of whether the growth rate of investments or of donated dollars is higher. Then, second of all, you sort of buy time for the world to get more information on what the best places to give are. So you might find better opportunities than you might otherwise would have. And that’s also potentially an advantage. 

There’s one other thing I would say, which is no matter what, I think it’s important that you do something to keep yourself honest. I think that means that if this is what you ultimately care about, [you should] at least [give] some amount, some non-trivial amount, each year. It’s a way to learn and to stay in touch and to force yourself to do that. It’s also a way to prove to yourself and to others that this is something that you’re serious about.

Will FTX Foundation solely serve as the corporation’s philanthropic arm, or do you intend to do grantmaking from your own wealth via the foundation? 

I think it’s primarily going to be FTX’s grantmaking. That’s not to say that it has to totally ignore the existence of any personal giving that I’m doing, but that’s not what it’s going to be focused on. My personal giving is going to be a separate thing. 

Stories about you habitually mention that you sleep on a bean bag in your office. Is there another key fact you wish they would cite?  

I don’t mind it at all. I have my fair share of personal quirks, I think many of them are pretty boring. I compulsively fiddle with things. One that has been spread a little bit is that sometimes I’ll actually be playing a video game in the background just to keep my hands busy. I multitask a fair bit.