As Sam Bankman-Fried’s FTX enters bankruptcy protection, Reuters reports that between $1 billion to $2 billion of customer funds have vanished from the failed crypto exchange.
Both Reuters and The Wall Street Journal found that Bankman-Fried, now the ex-CEO of FTX, transferred $10 billion of customer funds from his crypto exchange to the digital asset trading house, Alameda Research.
Alameda, also founded by Bankman-Fried, was considered to be a sister company to FTX. Those cozy ties are now under investigation by multiple regulators, including the Department of Justice, as well as the Securities and Exchange Commission, which is probing how FTX handled customer funds, according to multiple reports.
Much of the $10 billion sent to Alameda “has since disappeared,” according to two people speaking with Reuters.
Reuters disclosed that both sources “held senior FTX positions until this week” and added that “they were briefed on the company’s finances by top staff.”
One source estimated the gap to be $1.7 billion. The other put it at something in the range of $1 billion to $2 billion.
We're shocked -- shocked! -- to hear that a crypto bro was playing fast and loose with other people's now disappeared investment money. Meanwhile, the same advice for casinos holds for crypto: the only way to win is to exit as soon as you enter.
BONUS: More analysis of the bursting crypto bubble here.
(Image: Matt Damon shilling for Crypto.com in dumber times.)
