FTX’s massive $10 billion loan remained concealed in the documents.
Alameda’s former CEO implicates SBF in discussions with the Saudi Crown Prince.
In November 2022, the crypto world witnessed a shattering chapter in its history with the collapse of FTX, a once-prominent crypto exchange. What initially appeared as a mere accounting oversight soon unveiled itself as a massive fraud, resulting in the loss of billions of dollars for customers and investors.
Shockingly, it was revealed that customer funds had been redirected to accounts controlled by Alameda Research, a cryptocurrency trading firm based in Hong Kong, instead of FTX. This revelation sent shockwaves throughout the crypto market.
The aftermath of this revelation has been a never-ending saga of lawsuits and trials. In recent developments, on October 10, an ex-Alameda engineer disclosed an unpublished tweet thread from Sam Bankman-Fried (SBF), the face of FTX, discussing the potential shutdown of Alameda Research in 2022. SBF expressed his frustration with the persistent “FUD” surrounding Alameda’s connection with FTX, attributing it to competition-driven misinformation.
The thread also revealed his desire to transform Alameda into an investment firm and infrastructure developer while clarifying that it would cease active trading.
Notably, Alameda Research once played a pivotal role in providing liquidity and investments to various tokens and crypto firms. Long after, it was plagued by rumors, now seemingly validated, of trading against FTX clients and enjoying unfair advantages.
Caroline: A Partner in Crime?
Caroline Ellison, the former CEO of Alameda and allegedly SBF’s ex-girlfriend, is going viral among crypto netizens. Testifying during SBF’s trial in New York, she admitted to manipulating financial data. It is for review by Genesis, a major crypto trading firm.
Also, Ellison revealed that SBF instructed her to create “alternative” balance sheets regarding Alameda’s use of FTX’s funds. She admitted to providing seven different spreadsheets, one of which was presented to Genesis. But it did not disclose Alameda’s $10 billion borrowing from FTX.
Moreover, in a surprising turn of events, Ellison disclosed that SBF had explored the possibility of raising equity for FTX by considering an investment from Saudi Crown Prince Mohammed bin Salman (MBS). She revealed that discussions about hedging Alameda’s investments had taken place in 2022. SBF mentioned MBS as a potential investor in FTX before its eventual collapse in November.
Meanwhile, MBS is known for his considerable wealth and previous investment in blockchain gaming through the nation’s sovereign wealth fund.
Finally, as the trial unfolds, the FTX saga remains a riveting tale of deceit and intrigue in the crypto world. The shocking revelations and legal battles leave us with more questions than answers. The crypto community watches with bated breath as the story of FTX continues to evolve.