What is personal fiefdom meaning? Here we explain it in relation to FTX founder and former CEO Sam Bankman-Fried.
Infamous cryptocurrency firm FTX collapsed after being “run as a personal fiefdom of Sam Bankman-Fried,” a lawyer informed US bankruptcy court this month. The hearing took place on Tuesday, November 22.
The firm suddenly crashed at the start of this month, shocking the crypto world. Sam Bankman-Fried, often referred to as SBF, was dubbed the “next Warren Buffett” and the “JP Morgan of crypto.” SBF was even predicted to become the world’s first trillionaire. That was until the collapse of FTX brought his personal wealth to almost zero.
As FTX bring its insolvency filing to Delaware’s bankruptcy court, the court heard how SBF ran the firm as a “personal fiefdom.” But what does that mean in relation to the case?
Personal fiefdom meaning explained
A fiefdom is described in the Cambridge Dictionary as “an area or type of activity that is controlled by someone.”
It means that the area is under the complete control of a person but can also be managed by a group. A personal fiefdom, then, is an area or activity completely controlled by an individual.
When the lawyer informed the court that Sam Bankman-Fried oversaw FTX as his “personal fiefdom,” they were implying that he oversaw the firm with complete control.
Historical meaning of ‘fiefdom’ explored
If you’ve never come across the word ‘fiefdom’ before, you might be curious as to its historical roots. While the term ‘fiefdom’ has its uses in modern language, it mainly relates to the medieval period.
A fief was a central element in feudal law contracts of feudalism in medieval Europe. It refers to a source of income granted to a person (a vassal) by his overseeing lord in exchange for services. A typical example of a fief in medieval times is a piece of land.
Lords (AKA landlords) owned the fief and would give it to the vassals in exchange for feudal allegiance, services, and/or payments.
Sam Bankman-Fried ran FTX as a ‘personal fiefdom’
These medieval terms, while being worlds removed from FTX, can shed light on the way Sam Bankman-Fried oversaw the crypto firm. Here are some of the revelations from their insolvency filing.
Bankman-Fried and the FTX team famously uprooted their operations from Hong Kong to the Bahamas, because of the Caribbean island’s favorable regulatory environment. Bankman-Fried’s parents, FTX, and senior executives of the firm bought at least 19 properties worth nearly $121 million in the Bahamas, Reuters reports. Attorneys during Tuesday’s hearing (November 22) stated that Bankman-Fried’s team spent $300 million on holiday homes and property in the Bahamas for its senior staff.
Only now do we realize that “the emperor had no clothes,” attorney James Bromley said, calling the situation “one of the most abrupt and difficult collapses in the history of corporate America.”
What’s next for FTX?
This month has seen the internet captivated by SBF and FTX. Memes about the firm are taking over Twitter and fan-casting of Jonah Hill as Bankman-Fried in a The Big Short-style retelling of the crash.
The crypto firm is currently in limbo. On November 11, Sam Bankman-Fried resigned and filed for chapter 11 bankruptcy. However, no decision has been made by the bankruptcy court as of yet. Until the next hearing takes place on December 16, as reported by The Guardian, the future of FTX remains unclear.