FTX has collapsed last week....it continues to get worse as the days roll by...
SBF has stepped down as CEO
**update: 11/14/2022**
Alameda CEO Caroline Ellison, Sam Bankman-Fried, and two other FTX executives were aware of the decision to send FTX customer funds to Alameda. FTX used customer money to help Alameda meet its liabilities. The companies have filed for bankruptcy and Bankman-Fried has resigned. It could be a long time before bankruptcy proceedings are over and customers are able to recover any of their funds, if any.
**update 11/16/2022**
Who is SBF and how did he go from being crypto's savior to the man that brought a trillion-dollar industry to its knees? Grab a ☕️, here's the full sordid tale of his rise and fall:
1/ SBF (San Bankman-Fried) was raised by two Stanford Law professors and went to MIT.
In 2017, he founded Alameda Research, a quant trading firm, at just 25 years old. He made millions by trading on Bitcoin's price difference between Asia and the US.
2/ Two years later, SBF launched FTX, which became a top 3 global crypto exchange.
Valued at $32B, the exchange's investors include Sequoia Capital, Paradigm, and Ontario Teachers' Pension Plan.
Sequoia even wrote a glowing profile of SBF that it has since taken down.
3/ SBF's personal wealth rose to $26B.
He used this fortune to:
1. Become the #2 donor to the Democratic party in 2021-2022
2. Host a conference with Tom Brady, Gisele, and other celebs
3. Plaster FTX all over cities and arenas
4. Bail out crypto firms
4/ Alas, the house of cards was destined to fall.
Earlier this month, Coindesk published a report that most of Alameda's holdings were in FTT, a token invented by FTX.
Soon after, CZ (Binance CEO) shares that Binance is selling all of its FTT tokens.
5/ This led to a massive decline in FTT token price, making FTX insolvent.
Binance considers bailing out FTX on Nov 8 and walks away one day later after looking at the books.
6/ The revelations come out like rapid fire.
SBF claims that FTX and Alameda are separate entities.
In reality, "the whole operation was run by a gang of kids in the Bahamas." All 10 of them lived together in a penthouse. The CEO of Alameda is a 28-year-old that SBF reportedly dated.
7/ According to Reuters, SBF secretly moved $10B in customer funds from FTX to Alameda.
$1B of that is now missing, possibly due to a backdoor that was implemented in secret.
Asked about the missing funds, SBF responded: "???"
8/ Last night, millions of dollars started moving from FTX to anonymous wallets.
FTX claims it's a hack but many are saying that it's an insider job.
9/ FTX has filed for bankruptcy and SBF has stepped down.
The new CEO, John Ray III, was the lawyer brought on to clean up Enron.
10/ Billions of dollars have already evaporated but this is far from over.
FTX and Alameda invested in hundreds of companies. One of them, BlockFi, has already paused withdrawals.
11/ I think this debacle has caused permanent irreparable damage to crypto.
It will be a long time (maybe never) before people will trust this industry again.
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