FTX Trading

Main article: Cryptocurrency exchanges

FTX cryptocurrency , a derivatives trading platform, began operations on May 8, 2019.

Performance indicators

2022: Trading volume for October - $599 billion

History

2024: FTX crypto exchange founder Sam Bankman-Fried sentenced to 25 years in prison

On March 28, 2024, Manhattan federal court sentenced the founder and former head of the collapsed cryptoexchanges FTX Sam Bankman-Fried. He received 25 years in prison for fraud, conspiracy to launder money and a number of other crimes. More. here

2023

Reorganization Plan

New FTX management in December 2023 submitted a revised reorganization plan. FTX assets and management at the time of bankruptcy, which was conducted under Article 11 of the Internal Revenue Code, were not available for creditors' claims during the reorganization period. American regulators allow this item to be used only in cases where the asset is of value and its further use is planned.

The plan introduced a key provision according to which cryptocurrency claims are valued at their monetary value at the time of filing for bankruptcy on November 11, 2022. It is noteworthy that since then the cryptocurrency market has grown significantly, and the price of bitcoin has soared from $17,000 to more than $42,000.

FTX bribed officials in China, created fraudulent reports and laundered money

On October 11, 2023, the trial of Sam Bankman-Freedom, founder and CEO of FTX, revealed new details about the shenanigans of this bankrupt cryptocurrency exchange. It turned out that the company bribed officials in China, laundered money and falsified the reporting documentation.

Bankman-Fried is accused of financial fraud. He had previously pleaded not guilty to stealing billions from dollars FTX customer funds to cover the losses of his Alameda Research hedge fund focused on. cryptocurrency Former Alameda Research CEO Caroline Ellison testified in this case. FTX paid Chinese officials to unlock trading accounts on the OKX crypto exchange and China's Huobi, she said.

Allison alleges crimes she committed with Bankman-Freedom include "fraud, conspiracy to commit fraud and money laundering." The illegal actions led to the deception of FTX customers and investors, as well as Alameda Research creditors. Ellison also touched on her personal relationship with Bankman-Freedom: for several years, she said, they dated occasionally.

The whole time we met, he was also my boss at work, which created some awkward situations. I wanted more from our relationship, but I often felt that he was removed or not paying attention to me, Ellison said.

She added that the decision to use FTX customer funds to cover Alameda's shortfall was "Sam's decision," with Bankman-Fried repeatedly asking her to repay the loans. At the same time, it is noted that the founder of FTX is not charged with paying bribes to Chinese officials, and the testimony Ellison presented for "limited purposes."^[1]

Photos of Sam Bankman-Freed's $35m Bahamas home released

In early October 2023, FTX photos of his luxury penthouse in the Bahamas were released as part of a lawsuit against Sam Bankman-Freed, the founder and CEO of the bankrupt cryptocurrency exchange. The value of this property is approximately $35 million. More. here

Ex-head of crypto exchange let in stolen $100 million for political donations

In mid-August 2023, it became known that Sam Bankman-Fried, founder of the FTX cryptocurrency exchange, spent $100 million stolen from clients on political donations.

The US Securities and Exchange Commission has charged the creator of the bankrupt cryptocurrency exchange with "organizing a scheme to deceive investors." The updated indictment imposes on Bankman-Freed that he donated to both Democrats and Republicans to conceal the origins of the money.

He [Bankman-Fried] used his influence to lobby Congress and regulators to support legislation and regulation that he believes will make it easier for the FTX to further accept client deposits and grow, the case file said.

Bankman-Fried, 31, a former billionaire, is accused of conspiracy and fraud over the FTX crash. However, the indictment no longer includes "conspiracy to violate campaign finance laws" as a separate clause. Federal prosecutors in Manhattan said in July 2023 that they would drop this charge after the Bahamas, where the FTX crypto exchange was based and where Bankman-Fried was arrested in December 2022, said they never intended to extradite him on the relevant count.

Bankman-Fried had previously pleaded not guilty to stealing billions dollars from FTX customer funds to cover losses at Alameda Research, his hedge fund focused on. cryptocurrency However, on August 11, 2023, the court New York in canceled the bail for the founder of FTX - Bankman-Fried will expect the start of the trial in prison. The hearings are scheduled to begin on October 2, 2023.^[2]

The exchange was able to return $7.3 billion to customers. The possibility of restarting is being considered

By April 2023, the FTX crypto exchange was able to return $7.3 billion to customers after several months of work by the new management. The possibility of restarting the exchange is being considered.

Sam Bankman-Fried accused of giving $40 million to Chinese officials

The founder of the FTX crypto exchange Sam Bankman-Fried in March 2023 is accused of giving $40 million to Chinese government officials. He was also a sponsor of the Democratic Party of the United States.

Sam Bankman-Fried is not going to admit bribes to the Chinese authorities, and also denies guilt on any other charges. The maximum possible term on his charges is already 155 years.

New crypto exchange executive John Ray gets $1,300 an hour

The new head of FTX crypto exchange John Ray in February 2023 receives $1300 per hour. In December 2022, he earned $690,000 in his new position, while the exchange continues bankruptcy proceedings and is trying to find ways to return money to former customers and investors.

Demand for politicians to return $93 million in donations

The collapsed FTX exchange sent confidential letters to politicians in early February 2023 demanding that ~ $93 million in donations donated by Sam Bankman-Freedom and other FTX executives be returned by the end of the month by the end of February.

Sam Bankman-Fried refuses to plead guilty

In January 2023, FTX crypto exchange founder Sam Bankman-Fried said he was refusing to plead guilty to financial fraud and defrauding investors.

2022

Under house arrest, the head of the FTX crypto exchange Sam Bankman-Fried cashed $684 thousand

While under house arrest, in December 2022, the head of the FTX crypto exchange Sam Bankman-Fried cashed out $684 thousand.

Former Alameda chief Caroline Ellison admits stealing billions of dollars from FTX customers

Former Alameda chief Caroline Ellison admitted in December 2022 that she was stealing billions dollars from FTX crypto exchange customers.

Sam Bankman-Freed released from custody on $250m bail

Sam Bankman-Fried in December 2022 was released from custody on bail of $250 million. The judge decided that if he tried to escape and did not appear in court next time - Sam's parents would pay bail.

SEC claims Sam Bankman-Fried defrauded investors by $1.8bn

U.S. Securities and Exchange Commission claimed on December 13, 2022, that Bankman-Fried, who is under arrest in the Bahamas and facing criminal charges in, USA concealed the extent of the relationship between the FTX and his trading firm Alameda Research. The SEC also alleges it used customer funds.

"We allege that Sam Bankman-Fried built a house of cards on the foundation of deception, telling investors that it is one of the safest buildings in cryptocurrency," SEC Chairman Gary Gensler said in a statement.

Sam Bankman-Freed arrest by Bahamas police at US request

FTX crypto exchange founder Sam Bankman-Fried is arrested by the Bahamas Royal Police on December 12, 2022 at the request of the United States. He is accused of electronic fraud, securities fraud, money laundering and criminal conspiracy.

A judge in the Bahamas denied him bail. Sam Bankman-Fried's lawyer offered bail for his client in the amount of $250,000. At the end of November, the founder of FTX announced that he had $100,000 left in his account. Bankman-Freed faces up to 115 years in prison.

Sam Bankman-Fried says he can't explain where billions of customer dollars have gone from Alameda Research accounts

In an interview with the WSJ , FTX founder Sam Bankman-Fried said he could not explain what happened to the billions of dollars that clients of his bankrupt cryptocurrency exchange sent to the bank accounts of his company Alameda Research.

In an interview, he distanced himself from Alameda, saying he had moved away from running the firm and had no idea of its operation, even though he owned 90% of its shares.

Some FTX customers made deposits by transferring money to bank accounts controlled by Alameda, with the intention that the money would be used to top up FTX accounts. It was a legacy of the exchange's early days, when FTX did not have its own bank account, Bankman-Fried said. Over time, FTX customers put more than $5 billion in these accounts. Now those funds are gone.

Where did the missing money go? Sam Bankman-Fried says he can only guess.

"Sorry, I didn't want to," Bankman-Fried reached out to FTX crypto exchange employees

On November 24, 2022, FTX founder Bankman-Fried wrote an appeal to his former colleagues, apologized to them and explained why this happened.

According to Sam, it all started with the collapse of the market in the spring, then a decrease in loan volumes followed, and as a result, customers began to withdraw their funds en masse. In addition to these issues, he noted "poor margin management and insufficient risk control," which also led the company to file for bankruptcy protection and lose tens of billions of dollars.

'I never wanted something like this to happen. I did not realize all the scale of margin trade and related risks, "- said them Bankman-Fried.

Who lost money in FTX accounts

Sam Bankman and his staff's billion-dollar personal loans have surfaced

By November 17, 2022, it turned out that the ex-head of the FTX exchange, Sam Bankman-Fried, took $1 billion for personal needs in the form of a loan from one of his companies, Alameda Research. And earlier he transferred $10 billion of client money there from the FTX exchange.

The exchange's chief technology officer also took a half-billion from Alameda "on credit." The money was spent on homes in the Bahamas and sponsorship of the US Democratic Party. FTX also helped raise money for Ukraine.

New FTX CEO John Ray III, who came to bankrupt the exchange in shock at what happened, although he even saw the collapse of the Enron monster. He called the situation a complete failure: "Never in my career have I seen such a complete failure of corporate governance and such a complete lack of reliable financial information."

The FTX crypto exchange and the Alameda Research investment fund applied informal financial control rules - for example, transfers of several million dollars were approved by the management in the messenger using emoji. This was later discovered in April 2023 by the team running the FTX after it filed for bankruptcy.

Investors' $11 billion lawsuit against Sam Bankman

On November 16, 2022, American investors filed a $11 billion lawsuit against ex-head of the FTX crypto exchange Sam Bankman.

Interest of US authorities in the collapse of the exchange to strengthen the regulation of cryptocurrencies

It would seem that the clients of the exchange became victims of the usual fraudulent scheme. But the collapse of FTX was hardly a surprise for US government agencies: after all, the organization's leadership had long been on a short leg with representatives of the American authorities.

In the months before the collapse, FTX chief executive Sam Bankman-Fried spoke frequently with regulators in Washington. The FTX's close connection with lawmakers is also indicated by the fact that the bankruptcy application was filed under Chapter 11 of the US Bankruptcy Code, which allows for protection from creditors during the reorganization.

Where did the money go?

In today's world, disappearing with billions of dollars on your hands without risk to life is extremely problematic. To do this, at least patrons in the highest echelons of power are needed, who will be able to ensure a safe departure, noted the Rybar telegram channel.

So who turned out to be the most likely beneficiary of FTX bankruptcy to be the patron saint of its owners? Here it is worth carefully looking at the personalities of the persons involved in the scandalous bankruptcy.

Thus, the partner of the executive director of FTX is Caroline Ellison, who heads the Alameda Research structure affiliated with the bankrupt exchange. Her father was previously the boss of Gary Gensler - the current chairman of the US Securities and Exchange Commission (SEC). In turn, Gensler was personally appointed by US President Joe Biden.

Such connections explain well how the SEC accidentally did not notice the impending crypto-banking. And the overly soft reaction of US government agencies to what happened directly hints at the consistency of actions to collapse the FTX.

Why do US authorities need FTX bankruptcy?

The high-profile collapse of the exchange with the disappearance of the funds of many customers is the ideal reason for proposals for strict control of the cryptocurrency sphere.

And they have already appeared: US Treasury Secretary Janet Yellen has stated the need for careful regulation of the entire industry. And the US government has already begun to consider the possibility of such measures in accordance with the decree of President Joe Biden. Under the guise of FTX bankruptcy, the public is actually imposed on the need for large-scale control over the crypto market.

And this is a fundamental condition for the implementation of the already planned course for the wider spread of cryptocurrency and its full integration with the traditional financial market.

Sam Bankman-Fried and his top managers detained in the Bahamas, where 19 properties worth $121 million were bought with exchange funds

FTX founder Sam Bankman-Fried and two of his top managers were detained by authorities in the Bahamas, a source told Cointelegraph on November 13, 2022.

Later on November 15, 2022, Sam Bankman and Alameda CEO Caroline Ellison admitted that the latter used money from FTX customers. When the market collapsed in the spring, lenders began to withdraw loans, but Alameda had no liquid funds. Ellison therefore took funds from FTX customers. The exchange lent Alameda $10 billion.

At the expense of the collapsed FTX crypto exchange in the Bahamas, at least 19 real estate properties worth $121 million were bought. 7 apartments bought for top managers of the exchange in an elite Bahamian resort and a $16.4 million holiday home designed for Sam Bankman-Fried's parents were discovered.

In January 2023, it was reported that the heads of the FTX crypto exchange spent $40 million on resorts, food and flights over the past 9 months of the exchange. Of these, $15 million - accommodation in, hotels $7 million - food and entertainment, $4 million - air tickets. Top managers even signed a contract with a local airline to deliver their orders by plane Amazon from a warehouse in Miami to the Bahamas resorts.

FTX: Hackers stole $415m from us

In January 2023, the FTX crypto exchange announced that hackers stole $415 million from its accounts in November 2022.

On November 12, 2022, it was reported that the bankrupt FTX platform had been hacked and all applications were malware. A message about this was sent by the administrator of the FTX community chat to the official exchange group on Telegram. At the same time, he did not recommend going to the FTX website due to the risk of infection with Trojans.^[3] As reported, hackers used Trojans and auto updates, and mass transfers to third-party addresses were made from FTX clients' wallets. Amid reports of hacking, the Tether issuer blocked parts of the USDT associated with the address that was involved in the transfers.

Analytical company Nansen, which provided an overall withdrawal estimate of $662 million, said the coins left the FTX international and US exchanges.

The company's U.S. division's general counsel, Ryne Miller, said FTX began moving digital assets to cold storage - wallets that aren't connected to the internet - after filing for bankruptcy on Friday. This process was later accelerated "to reduce damage when unauthorized transactions are detected."

A separate report by Elliptic said that, according to initial data, almost $475 million was stolen from the exchange as a result of illegal transactions, with stolen stablecoins and other tokens quickly converted to Ether on decentralized exchanges - "a common technique used by hackers to prevent the seizure of their assets."

On Twitter (blocked in Russia), members of the cryptocurrency community quickly began to speculate that the outflow could have been coordinated by a member of Bankman-Fried's inner circle, pointing out that simultaneous and sophisticated FTX and FTX US hacks indicate potential hacking from within.^[4]

Sam Bankman-Fried quits as FTX CEO while company files for bankruptcy

On November 11, 2022, the FTX cryptocurrency exchange issued a press release according to which Sam Bankman-Fried leaves the post of CEO of FTX (John Ray III became his successor^[5]), and the company declares bankruptcy under Chapter 11. This procedure will allow companies to obtain protection from claims from creditors during business reorganization and debt restructuring.

Cyprus suspends FTX licence

In November 2022, Cyprus suspended the FTX license due to a liquidity crisis. Through Cyprus, FTX entered the European market.

FTX tries to raise about $9.4 billion from investors and rivals

On November 10, 2022, FTX crypto exchange is trying to raise about $9.4 billion from investors and competitors. The founder of the exchange, Sam Bankman-Fried, has already held talks with the creator of the TRON cryptocurrency Justin Sun and the OKX exchange, as well as a number of investment funds.

Binance pulled out of FTX takeover after examining its books

The WSJ on November 9, 2022, reported that Binance was pulling out of the FTX deal "following an analysis of the company's structure and books," the crypto exchange said in a statement.

"We hoped we could support FTX customers to provide liquidity, but the issues that have emerged are out of our control or the ability to help," Binance said.

FTX crypto exchange founder Sam Bankman-Fried has filed for personal bankruptcy.

FTT collapse after Binance announcement of possible company purchase

The exchange token FTX (FTT) rate for the day on November 8 fell by 23%. The price of the coin dropped to $15, updating the minimum from January 2021. At 11:20 Moscow time on November 8, FTT trades around $17, the weekly depreciation is 34%, according to CoinGecko.

The value of the FTX platform token began to decline after the CEO of the Binance cryptocurrency exchange Changpeng Zhao (CZ) announced that his company intends to sell the remaining FTT tokens from it within a few months.

Binance acquired shares of the company in December 2019, and also took a long-term position in the FTX Token platform token.

Billionaire Changpeng "CZ" Zhao became the undisputed king of the cryptocurrency world, shocking the industry with a takeover bid for FTX.com, a troubled company led by his main rival and former apprentice Sam Bankman-Freedom, FTX was a major player. FTX ranked 4th among crypto exchanges in terms of trading volume, according to CoinGecko. wrote] Bloomberg.

The American main owner of the FTX cryptocurrency exchange, 30-year-old Sam Bankman, had a fortune of $30 billion in mid-2022. He received billions from venture investors, although his experience in the crypt was only about three years old.

Sam Bankman-Fried, in May-June, transferred at least $4 billion to FTX funds in order to help save his other company Alameda Research from bankruptcy. Some of these funds were customer deposits.

After the fall of Bitcoin, his platform collapsed, and a hole of $8 billion was formed in his business. Along with it, bitcoin also collapsed even more.

The letter of intent to acquire the company from Zhao-owned Binance Holdings came after a bitter feud between the two people resulted in an open standoff, with Zhao actively undermining confidence in FTX finances and contributing to the outflow of users from the exchange. The day before the deal from Binance was accepted, Bankman-Fried said on Twitter that assets on the FTX were "fine." By Tuesday, he had changed his message.

The FTX exchange asked Binance for help and she agreed. The parties entered into a strategic partnership agreement and, probably, a purchase. The FTX was a big player. FTX ranked 4th among crypto exchanges in terms of trading volume, according to CoinGecko.

Within hours, the FTX token was down 92% due to the collapse of the FTX Empire and the drama surrounding a potential FTX acquisition by Binance.

Signing Memorandum of Understanding with Busan Government on Blockchain Infrastructure Development

Over the past two weeks, three major cryptoexchanges ones -, Binance FTX and - Huobi have signed Busan memoranda of understanding with the city government aimed at developing infrastructure in blockchain. This was announced South Korea on September 16, 2022 by Huobi Global representatives. More. here

2021: Raising $900 million, estimated at $18 billion

On July 20, 2021, FTX Trading announced that its market value had grown to $18 billion. This happened after a round of financing, thanks to which the cryptocurrency platform managed to attract investments in the amount of $900 million. The fund-raising event involved SoftBank Group Corp. and has become one of the biggest investors for the cryptocurrency exchange.

The round was attended by around 70 investors from around the world, including venture capital firm Sequoia Capital, private equity giant Thoma Bravo and Third Point, and the family of Paul Tudor Jones and UK hedge fund manager Alan Howard.

FTX, founded on July 21, 2021, headed by crypto billionaire Sam Bankman-Freedom, is also the owner and operator of the cryptocurrency exchange. FTX is created by traders for traders and offers products such as wholesale, as well as various derivatives, options, volatility products and tokens with a variety of leverage. The company is focused on both institutional and retail investors. For crypto investors from, USA the company has a separate crypto exchange to satisfy the jurisdiction in the market and comply with all economic operations for the tax service, because in rare cases transactions may not be completely transparent.

Sponsors of this company also include the famous couple Tom Brady and Gisele Bundchen, focused on a wide range of traders, including retail investors.

The latest funding comes amid a general easing in investor sentiment towards cryptocurrencies after initial popularity earlier this year. This is due to the growing concern of regulators around the world and in Russia, both to cryptocurrencies and various crypto exchanges.

FTX said it has more than 1 million active users and an average trading volume of about $10 billion in 1 day. Revenues in 2021 grew more than 10 times, and the company also plans to use a new injection of funds to expand its product offerings and for other investments.^[6][7]

2019: Platform Creation

FTX, cryptocurrency a derivatives trading platform, began operations on May 8, 2019. It was founded by Alameda Research. FTX was founded by CEO Sam Bankman-Freedom, who graduated Massachusetts Institute of Technology with a degree in physics.

Notes