Alameda – On Wednesday, the new management of discredited crypto exchange firm FTX made an unexpected disclosure about its founder’s payouts.
Sam Bankman-Fried, the company’s co-founder and ex-boss, allegedly received $2.2 billion in payments and loans from Alameda Research.
The amount is astounding and stands out when compared to other bosses.
Caroline Ellison, the former CEO of Alameda Research, was paid only $6 million.
According to documentation provided by the new management, a total of $3.2 billion was distributed to ex-FTX employees, the majority of whom came from the company’s sister trading firm.
When FTX went bankrupt in late 2022, Alameda Research was at the epicenter of the turmoil.
Sam Bankman-Fried also created the quantitative trading business.
Alameda has the authority to exploit FTX client assets for its own purposes without monitoring, according to newly appointed FTX CEO John J. Ray III, who inherited leadership when SBF fled.
Conversely, FTX was once considered one of the pinnacles of the Web3 era.
It was a digital asset exchange where clients could buy, trade, and speculate on the future prices of various cryptocurrencies.
Before collapsing, FTX had over 134 firms under its banner and was based in the Bahamas, which was more receptive to cryptocurrency.
SBF launched Alameda in 2019, although he claims he quit the trading firm’s leadership role in 2021, putting day-to-day operations in the hands of others.
Prosecutors believe that FTX’s abrupt insolvency was caused by management placing extremely hazardous wagers with client funds provided by Alameda Research.
SBF got the majority of the $3.2 billion in compensation, according to records revealed this week by FTX’s new administration.
While he got the biggest share of the pie, former FTX director of engineering Nishad Singh got $587 million.
Meanwhile, Gary Wang, co-founder, received $246 million.
Former FTX Digital Markets co-CEO Ryan Salame received $87 million, while former Alameda Research co-head Sam Trabucco received $25 million.
They did not include the large sum of more than $240 million spent to purchase luxury property in the Bahamas, according to the release.
Also, it should be noted that Trabucco resigned as CEO of Alameda in August.
He hasn’t been seen or heard from since.
Prosecutors have neglected to charge Sam Trabucco, despite the fact that the rest of SBF’s inner circle has already been charged.
Read also: Sam Bankman-Fried made donations to lawmakers before elections
Caroline Ellison was elevated to be Alameda Research’s sole CEO in October 2021, following Trabucco’s retirement.
They were previously the platform’s co-CEOs.
Ellison had an on-again, off-again romance with Sam Bankman-Fried.
While her participation in the company’s demise was well publicized, her history drew her even more attention, since her now-deleted Tumblr blog provided a fairly unusual view on what happened in the Bahamas penthouse.
The penthouse had ten housemates, including Ellison and SBF, who made high-level decisions there.
The group was defined as a “polycule,” or a network of people in a polyamorous relationship, so choices were not the only thing going on around the house.
Ellison’s blog, which was active from 2014 until 2022, displayed material in November that corresponded precisely with her history.
The contents of her blog revealed a great interest in racial science and polyamory.
It also gave greater insight into the author’s perspective on the crypto sector, as stated in one post:
“I didn’t get into this as a crypto true believer. It’s mostly scams and memes when you get down to it.”
The charges and the company today
In the United States, Sam Bankman-Fried is now facing 12 criminal counts, some of which were handed down in a superseding indictment in February.
The charges also involve a conspiracy to perpetrate fraud on FTX clients in connection with derivatives purchases and sales.
SBF pleaded not guilty to the original accusations in January.
He has been awaiting his trial in October since then.
Meanwhile, Ellison, Wang, and Singh have admitted to the deception and are collaborating with authorities.
Now, billions of dollars in FTX customer funds are missing, with a large portion alleged to have been stolen.
Image source: Salon.com