Ftx, the collapse has put the Bahamas in crisis

The Bahamas thrives on tourism and offshore banking, which together account for 85 percent of local gross domestic product, according to the U.S. Department of Commerce. The presence of FTX has participated (or at least should have) in the recovery of the country since the arrival of Hurricane Dorian in 2019 and the outbreak of the pandemic, elements that have had a negative impact on the influx of tourists. The crypto company was the big fish the Bahamas had caught in its bid to become a leading market for digital assets in the heart of the Caribbean.

However, behind the big promises lurked an environment without controls. An environment in which a circle of senior executives in their twenties and thirties have spent millions of dollars on just about anything, from travel to sports sponsorship deals and luxury homes. A lack of internal discipline meant that FTX spending was largely unchecked, making the situation even worse for the local context: large expenses correspond to an increasing local induced.

Ftx wasn’t the only cryptocurrency operator in town, but it sure was the flashiest. He has spent at least $300 million on real estate in the Bahamas. Most of these purchases are for homes and vacation properties used by executives. The real estate portfolio includes at least six multi-million dollar residences in the Albany complex, including the Bankman-Fried penthouse. Albany is an upscale resort community, which owns Tiger Woods and Justin Timberlake.

Among the perks for the company’s employees would be 24-hour catering in the office, as well as free groceries, in-home barbershop and twice-weekly massages. In its offices, the company spent more than $100,000 a week on catering and set up a private shuttle service to take workers around the archipelago. Now the restaurateurs, drivers and neighborhood cleaners who depended on FTX are in trouble.

In addition, the company has hired dozens of Bahamians in jobs related to logistics, such as assisting with event planning, and regulatory compliance. For local employees, working for the crypto giant was a dream: hefty salary, daily buffet and access to BMWs and Jeeps. Added to this are aid to local communities: Animal clinics, non-profit organizations and many other entities have received donations from Bankman-Fried and associates.

Not only that: earlier this year, FTX employees were given the opportunity to purchase shares in the company. Excited to be part of what seemed like a promising new industry, some Bahamian employees spent thousands of dollars buying stock in FTX. A double mockery.