FTX once used customer funds to buy back all the shares held by Binance
A court hearing on Wednesday revealed that FTX used client funds to buy back all shares held by its competitor Binance. As part of the buyback, Binance CEO Zhao Changpeng stated in a 2022 article that the company received over $2.1 billion in BUSD and FTT tokens.
Peter Easton, an accounting professor at the University of Notre Dame, was employed by the US Department of Justice (DOJ) to track the billions of dollars in transactions between Alameda and FTX, which is also part of the ongoing SBF trial.
Sam Bankman-Fried's Fraud Trial Takes a Dramatic Turn with Evidence of Vulgar Messages to Journalists about Regulators
During the fraud trial of Sam Bankman-Fried, prosecutors presented evidence of his vulgar messages to journalists about regulators. The messages included his belief that regulators "make everything worse" and his prior support for cryptocurrency regulation being mere public relations.
Alameda owes FTX customers $11.3 billion in June 2022
Peter Easton, an accounting professor at Notre Dame University, appeared in court to explain the severity of Alameda Research's alleged misuse of FTX client and investor funds. Based on Easton's testimony and a large number of process diagrams, between January 4, 2022 and February 11, 2022, $1.1 billion of FTX client deposits flowed to Alameda Research, with most of it being used for political donations, real estate investments, venture capital, and charitable donations.
In June 2022, Alameda's debt to FTX clients reached $11.3 billion, while Alameda and FTX's bank accounts had about $2.3 billion. This means that if every client chooses to withdraw their funds, the shortfall that Alameda and FTX cannot make up will reach $9 billion.
FTX Has Paid Nearly $100 Million in Sponsorship Fees to Riot Games and $67 Million to Two Music Festivals
According to The Block, court documents show that FTX had agreed to pay nearly $100 million in sponsorship fees to Riot Games, the developer of "League of Legends," within seven years. After FTX announced bankruptcy, Riot Games began trying to withdraw from the deal at the end of last year.
FTX has signed a sponsorship agreement of nearly US$100 million with Riot Games and sponsored nearly US$67 million in music festivals.
According to court documents presented as evidence in Sam Bankman-Fried's criminal trial, FTX agreed to pay nearly $100 million in sponsorship fees to the development team of the game League of Legends, Riot Games, who agreed to receive nearly $100 million over seven years. After FTX declared bankruptcy due to customer losses, Riot Games began trying to withdraw from the deal at the end of last year.
The documents also show that FTX agreed to provide approximately $42 million to the Tomorrowland music festival before 2026, an event frequently attended by top DJs such as Solomun. The Coachella music festival, held annually in Southern California, also signed a $25 million agreement with FTX.
This spreadsheet details dozens of sponsorship agreements signed by FTX during the crypto bull market, which prosecutors included as evidence on Monday and released in full today.
$9.2B Settlement for FTX Creditors Reached in Bankruptcy Proceedings
FTX exchange clients could receive a payout of $9.2 billion by mid-2024 as part of the ongoing bankruptcy proceedings. The agreement between creditors and the new management of the platform marks a significant milestone in resolving clients' property disputes. The proposed plan involves segregating FTX assets into three categories, with platform users receiving approximately $8.9 billion and the American division receiving $166 million. The settlement is subject to court approval, with an application deadline of December 16, 2023.
Proposed Settlement Could Return Over 90% of Assets to Customers of Bankrupt Crypto Exchange FTX by Q2 2024
FTX and FTX US customers may receive over 90% of their assets back by Q2 2024, according to a proposed settlement reached between FTX debtors and creditors. The settlement includes a "Shortfall Claim" in which FTX estimates that customers of FTX.com and FTX US would collectively receive 90% of assets available for distribution. FTX expects these funds to be disbursed by the end of Q2 2024 if approved by the Bankruptcy Court.
FTX Debtors Settle Customer Property Disputes in Chapter 11 Cases
FTX Debtors have settled customer property disputes as part of their pending Chapter 11 cases, with the customer shortfall settlement forming part of the Amended Plan of Reorganization, which FTX plans to file by December 2023. Subject to approval by the Bankruptcy Court, the proposed amended plan anticipates customers globally receiving over 90% of the distributable value.
The FTX Bankruptcy Address Has Pledged a Total of 16.7 Million MATIC to Polygon’s PoS Staking Contract
PeckShield has monitored that the FTX bankruptcy address has pledged a total of 16.7 million MATIC (valued at approximately $9.6 million) to Polygon's PoS staking contract.
Former FTX Engineering Director: FTX Once Paid Celebrities $1.3 Billion in Promotion Fees
In the SBF criminal trial, Nishad Singh, former engineering director of FTX, read out a list of transactions from an electronic spreadsheet in court, which showed that FTX provided promotion funds to celebrities and influencers far exceeding $1 billion.
The Address Controlled by FTX Liquidator Pledged 13.05 Million MATIC
According to Scopescan monitoring, FTX's clearing house controlled address pledged 13.05 million MATIC tokens (worth about $6.95 million) 11 hours ago. The expected annual reward is 599,572.3771 MATIC tokens (worth about $320,000).
FTX Debtors Have Reached Proposed Settlement Over Client Asset Dispute
October 17th, FTX officially announced that after extensive discussions with the Non-US Customer Special Committee, the Unsecured Creditors Committee, and the Collective Litigation Plaintiffs, FTX debtors have reached a proposed settlement regarding customer asset disputes.
Former FTX Engineering Director: SBF Had Planned to Spend $120 Million to Reach an Agreement With Telegram to Obtain TON Tokens
On October 17th, according to BitMEX Research citing testimony from former FTX engineering director Nishad Singh, in September 2022, SBF attempted to raise funds in the Middle East and planned to reach an agreement with Telegram to obtain TON tokens, with an expected cost of $120 million.
Former FTX engineering director faces up to 75 years in prison after pleading guilty
Former engineering director of the now-defunct cryptocurrency exchange FTX, Nishad Singh, is facing up to 75 years in prison on charges related to defrauding users. Singh also revealed details of his agreement with the US Department of Justice, which led him to plead guilty to fraud charges announced in February. As part of the agreement reached with prosecutors, Singh said he "hopes not to go to jail."
Former FTX Executive Testifies to Improper Use of Customers' Funds in SBF's Trial
The trial of Sam Bankman-Fried, founder of the now-defunct FTX exchange, took a dramatic turn in its third week as Nishad Singh, a former senior FTX executive, testified about improper use of customers' funds within the company. Singh, who had served as Head of Engineering at FTX, revealed that he became aware of a financial "hole" in the company's finances in September 2022, amounting to approximately $8 billion. Despite his knowledge of the discrepancies, Singh approved transactions that he believed were funded by user deposits. Singh's testimony offered insight into his relationship with Bankman-Fried, whom he initially admired but later lost respect for.
Former FTX engineering director reveals over $1 billion in funds given to celebrities and influencers
Former engineering director of FTX, Nishad Singh, presented a list of celebrity and influencer deals in court during Sam Bankman-Fried's criminal trial. The deals totaled over $1.3 billion, including $135 million for the renaming of a Miami entertainment complex to FTX Arena, $28 million for basketball player Steph Curry, $14 million for Canadian businessman Kevin O'Leary, and undisclosed amounts for Tom Brady, Gisele Bundchen, and Larry David. Singh also mentioned a conversation with Bankman-Fried and Gary Wang regarding an investment in K5 Global, which was ultimately made with FTX's money. Bankman-Fried previously made a $700 million deal with K5 Global's Michael Kives and Bryan Baum.
FTX’s estimated annualized income from staking SOL and ETH exceeds US$9 million
According to on-chain data on October 16th, FTX-related addresses have staked over 5.5 million SOL tokens (approximately $122 million) and over 24,000 ETH tokens (approximately $30 million).
The SOL tokens were staked through Figment with an estimated annual return of 6.79% (approximately $8 million), while the ETH tokens were staked on the Ethereum mainnet with an expected annual return of 3.4% (approximately $1 million).
The 5.5 Million SOL Pledged by FTX on Figment Is Expected to Receive More Than $8 Million in SOL
Blockchain addresses associated with FTX have shown that FTX pledged millions of dollars worth of ETH and SOL over the weekend. Of these, over 5.5 million SOL (valued at $122 million) and over 24,000 ETH (valued at $30 million) have been pledged, as shown as separate transactions on the blockchain.
PeckShield: Marked As FTX Bankruptcy Address Pledged 4416 ETH to Figment
PeckShield monitoring shows that the address marked as FTX bankruptcy has pledged 4416 ETH (6.85 million US dollars) to Figment.
Lawyers for FTX Founder Seek Expanded Questioning of Prosecution Witnesses in Trial Defense
FTX founder Sam Bankman-Fried's defense lawyers are requesting more room to explore defense theories through cross-examination and to bar prosecutors from relying on lay witnesses for expert testimony. The defense is likely looking to prevent more damage to Bankman-Fried's image in the eyes of jurors by shaping the testimony of upcoming witnesses.
