Tag: Sam Bankman-Fried

FTX is Suing Voyager to Resuscitate $446 Million in Loan Payments

(Reuters) Bankrupt crypto exchange FTX sued crypto lender Voyager Digital on Monday, seeking to claw back $445.8 million in loan repayments that FTX made before collapsing into bankruptcy in November 2022.

FTX and Voyager both filed for bankruptcy amid a 2022 collapse in cryptocurrency markets, but Voyager’s bankruptcy preceded FTX’s filing by four months.

After Voyager filed in July, it demanded repayment of all outstanding loans to FTX and its affiliate hedge fund Alameda Research.

FTX said in a court filing that on Alameda’s behalf, it paid Voyager $248.8 million in September and $193.9 million in October.

FTX also made a $3.2 million interest payment in August, according to its court filings.

Because those loan payments were made so close to FTX’s own bankruptcy filing, they are eligible to be clawed back and potentially used to repay other FTX creditors, according to FTX’s complaint.

Also Read: Ken Griffin Speaks Out on Retail Investors and FTX Collapse

FTX Scandal

FTX Scandal
Crypto News Weekly – Franknez.com.

FTX, once among the world’s top crypto exchanges, shook the sector in November by filing for bankruptcy, leaving an estimated 9 million customers and other investors facing losses in the billions of dollars.

Its founder Sam Bankman-Fried has been indicted on fraud charges, and several top executives, including Alameda Research CEO Caroline Ellison, have pleaded guilty to fraud.

Bankman-Fried has denied wrongdoing and is scheduled for trial in October.

FTX initially appeared to weather the storm that brought down Voyager and other crypto firms in summer 2022, presenting itself as a “white knight” that could stabilize reeling crypto markets.

FTX offered to buy Voyager’s platform in a bankruptcy auction, but the proposed acquisition fell apart when FTX imploded in November.

In its Monday court filing, FTX acknowledged the allegations that Alameda raided FTX customer assets to cover its risky borrowing and lending.

But it said Voyager and other crypto lenders were complicit in Alameda’s conduct, “knowingly or recklessly” pushing their clients’ assets toward Alameda.

“Voyager’s business model was that of a feeder fund,” FTX said. “It solicited retail investors and invested their money with little or no due diligence in cryptocurrency investment funds like Alameda and Three Arrows Capital.”

Three Arrows Capital also went bankrupt in 2022, and its founders have refused to cooperate with court-appointed liquidators who are trying to recover assets for Three Arrows customers.

Also Read: DOJ is Investigating Sam Bankman-Fried Connections: FTX Opposes

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DOJ is Investigating Sam Bankman-Fried Connections: FTX Opposes

(Reuters) FTX has objected to a U.S. Department of Justice request for an independent investigation into the once-prominent crypto exchange’s collapse, saying it is already conducting a wide-ranging probe that includes family members of FTX founder Sam Bankman-Fried.

FTX said in a court filing in Wilmington, Delaware, late on Wednesday that the DOJ’s proposed review would only add cost and delay to its bankruptcy case.

FTX acknowledged “fraud, dishonesty, incompetence, misconduct, mismanagement, and irregularity” in its past conduct, but said that its previous wrongdoing is already being probed by the company’s new management, its creditors and law enforcement agencies.

As part of its own investigation, FTX asked U.S. Bankruptcy Judge John Dorsey, who is overseeing its Chapter 11 proceedings, to help it secure documents from Bankman-Fried, members of his family and other insiders with information about FTX transactions that used “misappropriated and stolen” funds.

These transactions, it said, include a $16.7 million Bahamian real estate purchase under the name of Bankman-Fried’s parents, Joseph Bankman and Barbara Fried.

FTX is also seeking information about political donations connected to Bankman-Fried, asking wide-ranging questions about Mind the Gap, a political action committee founded by Barbara Fried, and Guarding Against Pandemics, an advocacy organization founded by Sam Bankman-Fried and his brother, Gabriel Bankman-Fried.

FTX said Guarding Against Pandemics’ multimillion-dollar Washington, D.C., headquarters was purchased with misappropriated funds.

A spokesperson for Mind the Gap said it did not receive direct contributions from Sam Bankman-Fried, although Bankman-Fried made donations to some political causes it recommended to its donor network.

Related: Citadel to Launch Crypto Exchange After FTX Collapse

FTX Bankruptcy Update Today

DOJ probes Sam Bankman-Fried connections | Latest FTX bankruptcy update 2023.
DOJ probes Sam Bankman-Fried connections | Latest FTX bankruptcy update 2023.

FTX, once among the world’s top crypto exchanges, shook the sector in November by filing for bankruptcy, leaving an estimated 9 million customers and other investors facing total losses in the billions of dollars.

The U.S. Department of Justice’s bankruptcy watchdog has called for an independent investigation into its collapse, a request that received backing from a bipartisan group of U.S. senators.

FTX’s new CEO, John Ray, who worked with court-appointed examiners while leading Enron Corp and Residential Capital through bankruptcy, is prepared to testify that examiners in those two cases cost a combined $150 million and provided “minimal” benefits to creditors, FTX said.

FTX’s official committee of creditors joined the company in opposing the appointment of an examiner.

FTX also on Wednesday night filed a new list of creditors in bankruptcy court, which included financial watchdogs and government agencies from the United States, Japan and Switzerland, as well as companies including Airbnb Inc and crypto giant Binance.

Sam Bankman-Fried, who has been accused of stealing billions of dollars from FTX customers to pay debts incurred by his crypto-focused hedge fund, has pleaded not guilty to fraud charges. He is scheduled to face trial in October.

Related: Sam Bankman-Fried on AMC Tokenized Shares Before Arrest

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Sam Bankman-Fried on AMC Tokenized Shares Before Arrest

Market News: SBF address AMC tokenized shares before being taken into custody.
Market News: SBF address AMC tokenized shares before being taken into custody.

Sam Bankman-Fried addressed the AMC tokenized shares just moments before being placed under custody.

A Bahamian judge denied FTX founder Sam Bankman-Fried bail on Tuesday, hours after U.S. prosecutors accused the 30-year-old of misappropriating billions of dollars and violating campaign laws in what has been described as one of America’s biggest financial frauds, per Reuters.

SBF is currently at a Bahamas correctional facility until February 8th and faces up to 115 years in prison.

Although federal prosecutors charged him with eight criminal counts, including conspiracy and wire fraud, Bloomberg says it’s unlikely he serves a sentence that long of a term.

One of Sam Bankman-Fried’s last interviews was with Unusual Whales in a Twitter space call prior to his arrest.

Sam Bankman-Fried was asked about the AMC tokenized shares to which he was able to share some information with the retail community.

Curious what AMC Entertainment has had to say about the fiasco?

Let’s discuss it below.

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Sam Bankman-Fried on AMC Tokenized Shares

Market News: Sam Bankman-Fried responds to AMC tokenized shares.
Market News: Sam Bankman-Fried responds to AMC tokenized shares.

Before Sam Bankman-Fried touched subject on AMC tokenized shares, The Chainsaw uncovered the harsh reality of the fraud that was taking place.

AMC’s FTX token was being used to manipulate its share price on its synthetic derivatives trading platform.

The publication thechainsaw.com and its report show that while FTX’s terms of service said the firm’s synthetic stocks were backed 1:1, that may not have been the case.

Additionally, thechainsaw.com published another report that details that Gamestop and Tesla shares could have been manipulated as well.

But the AMC community is getting the 1:1 ratio part mixed up.

Faceless accounts on Twitter have blown up information even they’re not certain of what it means.

The 1:1 ratio ties the AMC tokenized share to an actual security (real shares) legally binded by AMC Entertainment Holdings, inc.

However, upon doing some research, I found that FTX’s website was no longer linking to AMC’s tokenized terms of service and agreement, nor AMC Entertainment’s signing of agreement.

Unusual Whales asked Sam Bankman-Fried to confirm whether tokenized shares of AMC and GME were backed one to one.

SBF answers, “to my knowledge they were. But I want to get you a better answer to that question.”

AMC Entertainment CEO Adam Aron on AMC Tokenized Shares

AMC Entertainment CEO Adam Aron has not responded to queries regarding the AMC tokenized shares.

However, a shareholder from the retail community was able to obtain a response from AMC Entertainment via email.

Here is the response:

“AMC is aware of public reports regarding FTX’s bankruptcy. AMC has no affiliation, whatsoever, with FTX. AMC has never authorized any tokenized AMC shares nor benefited in any way from any tokenized AMC shares.”

AMC Tokenized AMC shares response from AMC Entertainment Holdings, Inc.
AMC Tokenized AMC shares response from AMC Entertainment Holdings, Inc.

Email credit: @30Alexandre2019

Leave Your Thoughts Below

Sam Bankman-Fried was taken into custody after this interview with Unusual Whales on the Twitter space call.

We may never find out what his follow up to the topic on AMC tokenized shares is.

But the Vice President of Capital Markets and Investor Relations for AMC Entertainment has said the movie theatre chain was never involved.

AMC’s tokenized shares were never backed 1:1 between FTX and AMC Entertainment Holdings, inc. meaning it was all synthetic; a fraud.

I’d love to hear your thoughts on the matter.

Leave a comment down below.

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AMC FTX Token Was Used to Manipulate Real Stock Prices

On Dec. 4, 2022, a report details that FTX-based synthetic stocks may have been used to manipulate the value of AMC shares.

In May 2021, FTX offered 36 tokenized stocks, but speculators believe it’s questionable whether or not the firm actually held the real stocks in the first place.

FTX has been under the microscope ever since the exchange collapsed during the first week of November 2022.

Since then, there’s been a lot of information to process, and new information released.

On Sunday, a report details that tokenized stocks listed on FTX may have been used to “manipulate the price of AMC shares.”

The publication thechainsaw.com and its report show that while FTX’s terms of service said the firm’s synthetic stocks were backed 1:1, that may not have been the case.

“FTX listed wrapped AMC token[s] for trading on its synthetic derivatives trading platform,” The Chainsaw said on Twitter.

Additionally, thechainsaw.com published another report that details that Gamestop and Tesla shares could have been manipulated as well.

Furthermore, the researchers note that the leaked FTX balance sheet disclosed by the Financial Times (FT) shows the company only holds Robinhood (HOOD) shares.

There’s no documentation (as of right now) that’s been made public that shows FTX actually owned any of the 36 tokenized stocks it listed.

Source(s): Bitcoin.com.

No Proof of AMC Ownership

Market News: AMC Token was used to manipulate stock price.
Market News: AMC Token was used to manipulate stock price.

There are no signs of AMC Entertainment signing an agreement to the AMC FTX Token listed on the FTX crypto exchange.

When viewing the terms of service and terms of the tokenized stock product (AMC), users are prompted to error pages.

Now, there is no official FTX website as it has been changed to a ‘help concierge‘.

The sale of an AMC token was a scam.

But I’m curious to know your thoughts on this matter.

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Was The AMC FTX Token a Scam to Launder Money?

There are no signs of AMC Entertainment signing an agreement to the AMC FTX Token listed on the FTX crypto exchange.

When viewing the terms of service and terms of the tokenized stock product (AMC), users are prompted to error pages.

The AMC FTX token is also showing as an ‘invalid symbol’ on the platform with no live chart as we’ve seen in the past.

The tokenized stock was trading at $4 (USD) but has lost all its value since the company collapsed and filed for bankruptcy.

Retail investors are digging deep and are concluding that the crypto exchange could have potentially been using these tokens to launder money.

The FTX scandal only goes deeper into the rabbit hole.

Let’s discuss what happened.

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FTX Scandal: What Went Wrong?

What happened to FTX? FTX Scandal
What happened to FTX? FTX scandal | Crypto News.

Cryptocurrency exchange FTX filed for Chapter 11 bankruptcy on November 11, 2022, after the company’s valuation dropped from $32 billion to bankruptcy in only a matter of days.

The collapse of the cryptocurrency exchange dragged founder and CEO Sam Bankman-Fried’s $16 billion net worth to near-zero.

FTX was responsible for dropping the crypto industry below $1 trillion.

On November 16, a class-action lawsuit was filed in a Florida federal court, alleging that Sam Bankman-Fried created a fraudulent cryptocurrency scheme designed to take advantage of unsophisticated investors from across the country.

Which celebrities were affected by FTX?

Steph Curry FTX
Steph Curry FTX promotion | Celebrities affected by FTX crypto scandal.

Celebrities named in the lawsuit include Steph Curry, Shaquille O’Neal, Shohei Ohtani, Naomi Osaka, Larry David, and Kevin O’Leary who allegedly helped Bankman-Fried promote the exchange.

FTX became one of the largest crypto exchanges in just three years with a valuation of $32 billion.

Bankman-Fried used aggressive marketing, including a Super Bowl ad campaign, and the purchase of naming rights to the home of the Miami Heat basketball team.

He became known for his political lobbying and donations as well as for working to support the cryptocurrency industry more broadly.

As values plunged in early 2022, he facilitated deals totaling about $1 billion to bail out cryptocurrency companies struggling as a result of the declines in token prices.

Conflict of Interest Created Mass Selloff in FTX

How did Binance play a role in FTX collapse? Binance FTX news.
How did Binance play a role in FTX collapse? Binance FTX news.

FTX’s collapse took place over a 10-day period in Nov. 2022.

The catalyst for the crisis was a Nov. 2 scoop by CoinDesk that revealed that Alameda Research, the quant trading firm also run by Bankman-Fried, held a position worth $5 billion in FTT, the native token of FTX.

The report revealed that Alameda’s investment foundation was also in FTT, the token that its sister company had invented, not a fiat currency or other cryptocurrency.

That prompted concern across the cryptocurrency industry regarding SBF’s companies’ undisclosed leverage and possession of assets.

Here’s when things really started going downhill for FTX.

Binance, the world’s biggest crypto exchange, announced on Nov. 6 that it would sell its entire position in FTT tokens, roughly 23 million FTT tokens worth about $529 million.

Binance CEO Changpeng “CZ” Zhao said the decision to liquidate the exchange’s FTT position was based on risk management, following the collapse of the Terra (LUNA) crypto token earlier in 2022.

By the next day, FTX was experiencing a liquidity crisis.

Bankman-Fried attempted to reassure FTX investors that its assets were stable, but customers demanded withdrawals worth $6 billion in the days immediately following the CoinDesk report.

Bankman-Fried searched for additional money from venture capitalists before turning to Binance.

The value of FTT fell by 80% in two days.

Sources: Investopedia.

FTX: A Pyramid Scheme Created from Mass Marketing?

FTX Pyramid Scheme
Was FTX a pyramid scheme? Crypto news and more.

Within hours of filing for bankruptcy, FTX was hacked.

The exchange noted that ‘unauthorized transactions’ close to half a billion dollars in total were stollen from several wallets during a period of days.

Since the incident, regulators of the Bahamas have frozen FTX’s assets, and the company has strongly advised against customer deposits.

What’s occurred with FTX is an ongoing investigation and lawsuit against now ex-CEO Sam Bankman-Fried.

So, was FTX just a scam to laundering money through the use of unauthorized stock tokens and covered by the hack that occurred?

Or was this just a poorly managed incident that occurred without motive?

I’d love to hear your thoughts on this.

Leave a comment down below.

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