At least $1 billion of customer funds — and possibly as much as $2 billion — have gone missing in the shocking implosion of the crypto currency exchange FTX, according to reports.
FTX’s flamboyant founder, Sam Bankman-Fried, known in the industry as “SBF,” secretly funneled $10 billion of customer funds into his trading company, Alameda Research, sources told two media outlets.
Alameda Research is run by Bankman-Fried’s girlfriend, Caroline Ellison.
Two senior FTX officials claimed they saw the evidence that the money was missing in copies of financial records Bankman-Fried shared with company executives last week, according to Reuters.
On Friday, Bankman-Fried stepped down from his CEO position as the Bahamas-based FTX filed for Chapter 11 bankruptcy, after scrambling to shore up an $8 billion liquidity crisis that has left investors unable to claim their funds.
At the same time, Miami-Dade County and the NBA’s Miami Heat abruptly announced Friday they are re-naming the FTX Arena and ending their relationship with the ruined company and disgraced founder.
“Miami-Dade County and the Miami HEAT are immediately taking action to terminate our business relationships with FTX, and we will be working together to find a new naming rights partner for the arena,” the county and team wrote in a joint statement.
A bid to save FTX via a rescue deal with rival exchange Binance didn’t work out, leading to crypto’s highest-profile collapse in recent years.
In text messages to Reuters, Bankman-Fried, one of the largest donors to the Democratic Party, said he “disagreed with the characterization” of the $10 billion transfer.
“We didn’t secretly transfer,” he said. “We had confusing internal labeling and misread it,” he added, without elaborating.
“???” was Bankman-Fried’s response, when asked about the missing cash.
With Post wires