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SBF Explains The FTX-Alameda Relationship

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SBF explains the FTX-Alameda relationship.

Sam Bankman-Fried recused himself from the Alameda investigation and denied knowing how FTX and Alameda were connected.

Former FTX CEO Sam Bankman-Fried is being investigated by lawyers for the relationship between crypto exchange FTX and trading company Alameda Research. SBF allegedly instructed its clients to transfer money to FTX from Alameda bank accounts at Silvergate and other banks.

In an interview with the New York Times, SBF defended itself against the fraud allegations. Also, leaving Alameda completely, saying “I don’t run Alameda”.

Sam Bankman-Fried denied overseeing Alameda

SBF insisted that it was not aware of the relationship between FTX and Alameda Research, or of the large amount of money being transferred between FTX and Alameda.

Alameda had nearly 10% leverage a year ago. However, the number of stock market crashes has reduced the value of these assets and increased power. Sam Bankman-Fried said more than $10 million was “wiped out in a matter of days,” leaving FTX unable to break the bank and release the money owed. Speaking about the combination of funds, SBF said, “I don’t know of any combination of funds.” However, it’s good at a big level in Alameda, which is another failure of care on his part. In addition, he believes that Alameda has a low position in the crypto lending industry. Alameda transferred these positions to FTX after the crypto lending company collapsed due to financial problems.

SBF denied knowing what was going on between FTX and Alameda until last month. He pointed to the conflict of interest caused by the lack of participation in labor, finance and decision-making in Alameda.

Speaking about the free money in the work of FTX and FTX US wallets, he agreed to transfer some money from FTX US members to the holding wallet in another part taken by Bahamian regulators. In addition, he admitted that FTX was defrauded with money from people he did not know.

How the FTT label becomes a key part of the relationship

FTX Token (FTT) allows customers to use it to trade their crypto on crypto exchanges. Alameda is the first market maker for FTT tokens, buying and selling lots of FTT. In fact, FTX offered a business discount for using FTT. Alameda has begun using its FTT holdings as collateral for additional loans from crypto lenders to support its business operations. Larry Fink, CEO of BlackRock, also believes that the FTT token is the reason for the failure of FTX.

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