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☆ Sam Bankman-Fried repeats his claim that he 'didn't steal funds' as he resurfaces on Substack
▼ + stars: | 2023-01-12 | by ( Sam Tabahriti | ) www.businessinsider.com time to read: +2 min

He again insisted that he did not "steal funds" from FTX and hadn't "stashed billions away." The co-founder of collapsed cryptocurrency exchange FTX wrote in Substack post that "I didn't steal funds, and I certainly didn't stash billions away." "Alameda's contagion spread to FTX," Bankman-Fried continued. Near the end of his post, Bankman-Fried added: "All of which is to say: no funds were stolen. Bankman-Fried didn't immediately respond to a request for comment from Insider.

Jan 12 (Reuters) - U.S. crypto company Digital Currency Group (DCG) is at the center of the industry's latest meltdown after one of its companies, Genesis, froze customer withdrawals in November. Here is what we know about the many companies Digital Currency Group owns:COINDESKDCG acquired crypto news website CoinDesk in 2016 after previously investing in the outlet. Genesis' crypto lending arm, Genesis Global Capital, announced in November its crypto lending arm would stop making new loans and blocked customers from withdrawing funds, citing the market dislocation caused by the collapse of FTX. Genesis Global Capital had partnered with a number of other crypto companies, including crypto exchange Gemini, to offer a crypto lending product. DCG itself owes $1.675 billion to Genesis' crypto lending arm, according to a November letter Silbert sent to shareholders.

Former FTX chief executive Sam Bankman-Fried (C) arrives to enter a plea before US District Judge Lewis Kaplan in the Manhattan federal court, New York, January 3, 2023. In a Thursday morning Substack post, FTX co-founder Sam Bankman-Fried denied allegations that he stole billions in user funds and suggested that Binance CEO Changpeng "CZ" Zhao conducted a monthslong effort to bring down FTX. It is Bankman-Fried's first significant response to federal allegations that he directed an $8 billion fraud that destroyed his $32 billion crypto conglomerate. In the beginning of 2022, for example, Bankman-Fried says he estimated Alameda's total net assets at $99 billion. By October, he believed that his hedge fund's net assets had fallen to $10 billion.

☆ Sam Bankman-Fried's trading firm borrowed $65 billion from FTX via a 'secret backdoor' to fund donations and a luxury lifestyle, bankruptcy court hears
▼ + stars: | 2023-01-12 | by ( Pete Syme | ) www.businessinsider.com time to read: +3 min

Bankruptcy lawyers revealed Sam Bankman-Fried's Alameda had access to $65 billion from FTX. The customer loans were made available via a backdoor created by FTX cofounder Gary Wang, they said. It was $65 billion." Dietderich told the court that with the $65 billion back door, Alameda "bought planes, houses, threw parties, made political donations." The court heard how FTX had so far recovered $5 billion of cash, crypto, and securities, with "plans to monetize over 300 other non-strategic investments" worth $4.6 billion.

☆ Sam Bankman-Fried says tweets from Binance's CEO in November were a 'targeted attack' on Alameda's assets
▼ + stars: | 2023-01-12 | by ( Brian Evans | ) www.businessinsider.com time to read: +3 min

Sam Bankman-Fried said Alameda's assets were the focus of a "targeted attack" by Binance CEO Changpeng Zhao. "In November 2022, an extreme, quick, targeted crash precipitated by the CEO of Binance made Alameda insolvent," Bankman-Fried wrote. "In November 2022, an extreme, quick, targeted crash precipitated by the CEO of Binance made Alameda insolvent," Bankman-Fried said. A series of crashes in the crypto market last year led to a roughly 80% decline in the value of Alameda's assets. "Over the few days in November, Alameda's assets fell roughly 50%."

☆ 'I didn't steal funds,' Sam Bankman-Fried says in unusual post-arrest blog post
▼ + stars: | 2023-01-12 | by ( Luc Cohen | Thomson Reuters | Reports On The New York Federal Courts. Previously Worked As A Correspondent In Venezuela | ) www.reuters.com time to read: +2 min

"I didn't steal funds, and I certainly didn't stash billions away," Bankman-Fried wrote in the blog published on Substack, in a rare public statement by a U.S. criminal defendant. He wrote that Alameda failed to hedge against an "extreme" crash in the crypto markets, which ultimately came to pass last year. "As Alameda became illiquid, FTX International did as well, because Alameda had a margin position open on FTX," Bankman-Fried wrote. Caroline Ellison, Alameda's former chief executive, said in her plea hearing that Bankman-Fried and other FTX executives received billions of dollars in secret loans from Alameda. Reporting by Luc Cohen in New York; editing by Amy Stevens and Himani SarkarOur Standards: The Thomson Reuters Trust Principles.

☆ FTX has recovered $5 billion worth of ‘liquid’ assets, lawyers say
▼ + stars: | 2023-01-11 | by ( Rohan Goswami | Rohan Goswami Is A News Associate At Cnbc. | ) www.nbcnews.com time to read: +1 min

FTX has recovered over $5 billion worth of liquid assets, including cash and digital assets, attorneys in Delaware bankruptcy court said during an FTX bankruptcy hearing Wednesday. The news comes after federal prosecutors announced plans to seize at least $500 million worth of FTX-connected assets as part of their ongoing prosecution of FTX co-founder Sam Bankman-Fried. FTX’s new CEO, John J. Ray, previously attested that at least $8 billion of customer assets were unaccounted for in the “worst” case of corporate control he’d ever seen. FTX CEO John Ray testifies before the House Financial Services Committee on Dec. 13, 2022. Manuel Balce Ceneta / AP fileThe $5 billion figure doesn’t include any illiquid cryptocurrency assets, FTX attorney Adam Landis told the court.

☆ FTX lawyers have recovered $5 billion in assets
▼ + stars: | 2023-01-11 | by ( Allison Morrow | ) edition.cnn.com time to read: +3 min

New York CNN —FTX officials overseeing its bankruptcy have recovered more than $5 billion in cash and other liquid assets that may be used to help repay creditors, a lawyer for the failed crypto firm said during a bankruptcy court hearing Wednesday. That disclosure significantly raises the estimated amount of funds FTX claims to hold. Last month, FTX lawyers submitted filings that showed the company and its affiliates had a total of $1.2 billion in cash. The lawyers also said they had identified more than 9 million creditors — far more than earlier estimates of around 1 million. FTX founder Sam Bankman-Fried arrives pleaded not guilty to fraud and conspiracy charges in Manhattan on January 3.

The U.S. Commodities Futures Trading Commission has estimated missing customer funds at more than $8 billion. The affiliates -- LedgerX, Embed, FTX Japan and FTX Europe -- are relatively independent from the broader FTX group, and each has its own segregated customer accounts and separate management teams, according to FTX court filings. In part to preserve the value of its businesses, FTX also sought Dorsey's approval to keep secret 9 million FTX customer names. Dorsey allowed the names to remain under wraps for only three months, not six months as FTX wanted. In addition to customer funds lost, the collapse of the company has also likely wiped out equity investors.

☆ FTX bankruptcy documents show list of investors set to be completely wiped out, including Tom Brady and Robert Kraft
▼ + stars: | 2023-01-10 | by ( Matthew Fox | ) www.businessinsider.com time to read: +3 min

FTX released a list of its equity holders on Monday as it continues to navigate the bankruptcy process. Some of the top holders of FTX equity included in the list are Tom Brady, Robert Kraft, and Gisele Bündchen. The FTX shares owned by Brady, Kraft, and Bündchen are expected to be worthless. Billionaire Robert Kraft, who owns the New England Patriots football team, was also listed in the FTX bankruptcy document. Other investors on FTX's equity-holder list include Wall Street's elite hedge funds and growth investors, according to the bankruptcy document.

☆ Tom Brady and Gisele Bundchen’s FTX stake will probably get wiped out
▼ + stars: | 2023-01-10 | by ( Allison Morrow | ) edition.cnn.com time to read: +2 min

Brady owns 1.1 million common shares of FTX, while Bundchen owns 686,000 shares, according to bankrupcty court documents filed Monday. Whatever Brady and Bundchen paid for their stakes, they, along with hundreds of other investors, will almost certainly see their positions completely wiped out. When companies go bankrupt, stockholders are typically the last in line to recover any funds. Soon after FTX’s collapse, a customer filed a proposed class-action lawsuit against FTX founder Sam Bankman-Fried, along with Brady, Bundchen and several other celebrity backers. Federal prosecutors accuse the 30-year-old entrepreneur, once a celebrity in crypto circles, of stealing customer funds from FTX to cover outsize losses at his hedge fund, Alameda.

☆ Former top FTX engineer who lived in Sam Bankman-Fried's Bahamas penthouse is trying to cut a deal with fraud prosecutors, report says
▼ + stars: | 2023-01-10 | by ( George Glover | ) www.businessinsider.com time to read: +3 min

FTX's ex-chief engineer last week met prosecutors probing the crypto exchange's collapse, per Bloomberg. Sam Bankman-Fried's ex-roommate Nishad Singh could become the 3rd top FTX exec to cut a deal. Prosecutors hope Singh will shed light on Bankman-Fried's political donations, per Bloomberg. He worked as an engineer at Facebook before joining FTX, according to a LinkedIn profile that has now been taken down. Read more: FTX fraud investigators are digging deeper into Sam Bankman-Fried's inner circle – and reportedly have ex-engineer Nishad Singh in their sights

☆ Coinbase will chop 20% of its staff in a 2nd round of big job cuts, as its boss blames 'unscrupulous actors' for putting pressure on crypto
▼ + stars: | 2023-01-10 | by ( George Glover | ) www.businessinsider.com time to read: +4 min

Coinbase will cut 20% of its workforce amid a crypto selloff, its CEO Brian Armstrong said Tuesday. It's the 2nd round of big job cuts after the crypto exchange chopped 18% of staff in June. The crypto exchange plans to slash 950 jobs in a bid to reduce its operating expenses by 25%, he said in a blog post. "In 2022, the crypto market trended downwards along with the broader macroeconomy," he said. The job cuts are part of a restructuring plan that Coinbase expects to complete by the end of June 2023.

☆ BlockFi says it repaid investor $15 mln to settle over crypto crash
▼ + stars: | 2023-01-09 | by ( Dietrich Knauth | ) www.reuters.com time to read: +3 min

Jan 9 (Reuters) - Executives of bankrupt crypto lender BlockFi Inc have repaid an investor $15 million to settle a threatened lawsuit over the company's cratering equity value in summer 2022, the company's attorneys said Monday in bankruptcy court. The BlockFi investor threatened to sue, alleging that BlockFi and its executives should have been more transparent about contagion risks in the cryptocurrency market, according to Sussberg. BlockFi believed the investor's claims were "specious," but it reached a confidential settlement on Aug. 23 under which BlockFi executives repaid $15 million to the investor, Sussberg said. That loan gave FTX an option to buy BlockFi for $240 million, essentially setting a maximum value for existing equity. As the company's value plummeted, BlockFi laid off 20% of its employees.

☆ Analysis: Bankman-Fried fraud charges sidestep debate over how U.S. law sees crypto
▼ + stars: | 2023-01-09 | by ( Luc Cohen | Thomson Reuters | Reports On The New York Federal Courts. Previously Worked As A Correspondent In Venezuela | ) www.reuters.com time to read: +5 min

"It's a pretty simple deception," said Shane Stansbury, a professor at Duke University School of Law and former Manhattan federal prosecutor. The debate matters to cryptocurrency companies because it could determine which agency regulates the trading of digital assets. Both have pleaded not guilty and argued the charges should be dismissed because insider trading charges must involve securities or commodities. In bringing wire fraud charges in both cases, prosecutors avoided taking a position on how cryptocurrencies or NFTs should be classified. It is unlikely Bankman-Fried's lawyers will attempt a similar argument because the wire fraud charges are more straightforward, Kasten said.

☆ Sam Bankman-Fried's Robinhood shares have been seized by the Justice Department in FTX case
▼ + stars: | 2023-01-09 | by ( Brian Evans | ) www.businessinsider.com time to read: +2 min

The Department of Justice has seized $450 million worth of Robinhood shares held by Sam Bankman-Fried and Gary Wang. The roughly 55 million shares are owned by the two via a holding company, and have been the focus of an ownership dispute. In a recent court filing, the Justice Department said the Robinhood shares "constitute property involved in violations" such as money laundering and wire fraud. BlockFi, which is also in the middle of its own bankruptcy case, is arguing that the Robinhood stock should be in their possession. BlockFi sued Bankman-Fried for the Robinhood shares in November, saying a $1 billion pledge by Alameda Research to secure loan obligations included the stake.

☆ 'Effective Altruism' has been touted by tech stars from Sam Bankman-Fried to Elon Musk. Here's how it started and how it's going after FTX's implosion.
▼ + stars: | 2023-01-08 | by ( Lakshmi Varanasi | ) www.businessinsider.com time to read: +2 min

Effective altruism is a social movement that relies on evidence and reasoning to figure out the best ways to help others. Its supporters include major Silicon Valley tech personalities like Elon Musk, Sam Bankman-Fried, and Peter Thiel. He drove a Toyota Corolla, ate vegan food, and lived with several roommates — presumably due to his belief in a social movement called effective altruism. For many, it's brought the principles of effective altruism into question. Here's a closer look at the ideas behind effective altruism and what philosophers and followers are saying in the aftermath:

☆ Sam Bankman-Fried's not-guilty plea keeps his options open, says a former federal prosecutor who explains what the criminal case means for investors-turned creditors of FTX
▼ + stars: | 2023-01-08 | by ( Laila Maidan | ) www.businessinsider.com time to read: +6 min

The Commodity Futures Trading Commission's lawsuit had alleged that both Ellison and Wang knowingly deceived the public under Bankman-Fried's direction. O'Brien, a former assistant US Attorney for the Department of Justice, specializes in white-collar criminal defense and commercial and securities litigation. "When you get indicted, your first appearance in court, you don't know what the charges are. You're presented with a piece of paper, an indictment, but you don't know what the evidence is." But Bankman-Fried's plea doesn't have much to do with what the outcome will be for investors who lost funds on the exchange, O'Brien noted.

☆ Oops, We Botched Ranked-Choice Voting
▼ + stars: | 2023-01-07 | by ( The Editorial Board | ) www.wsj.com time to read: 1 min

Nearly two months after November’s election, Alameda County, Calif., has announced that it systematically counted the ballots wrong. Blame the mess on official incompetence, but reserve some ire for ranked-choice voting (RCV), a system that makes it complicated even to explain the mistake. RCV asks voters to rank candidates in order of preference. If nobody wins an outright majority of first votes, the bottom candidate is eliminated, and his supporters are reshuffled based on their subsequent choices. This continues until a majority winner emerges.

☆ Luck, Tesla design likely saved family that plunged off cliff, experts say
▼ + stars: | 2023-01-06 | by ( Tim Stelloh | Tim Stelloh Is A Breaking News Reporter For Nbc News Digital. | ) www.nbcnews.com time to read: +5 min

Four people were rescued after a Tesla plunged over a cliff in Calif., on Monday. Patel, a 41-year-old woman and two children ages 4 and 7 — both of whom were in car seats — were also in the SUV, California Highway Patrol spokesman Mark Andrews said. Nor is it clear what driving mode Patel was using before the SUV careened off the cliff, the California Highway Patrol said. “In my 35 years of working on vehicle safety, I’ve never had an automaker say, 'Look at this crash test we’re doing for extra credit,'” he said. Helicopters were dispatched, and the family was hoisted from the vehicle using rescue baskets, he said.

☆ Silvergate extends sell-off into 2nd day as Bank of America sees 35% downside after the crypto bank disclosed huge run on deposits
▼ + stars: | 2023-01-06 | by ( Carla Mozée | ) www.businessinsider.com time to read: +3 min

BofA downgraded Silvergate Capital on Friday and said it sees another 35% downside for the crypto-focused bank. Silvergate shares plunged Thursday after it was revealed customers withdrew billions in deposits. BofA whittled down its price objective on Silvergate by 78% to $8 a share from $37. "Silvergate's preliminary 4Q22 results introduced a new overhang on the stock: negative earnings growth," Bank of America analyst Brandon Berman wrote in a note published Friday. It now sees those earnings coming in at $0.67 and $0.90, respectively, primarily reflecting a 50% reduction to its revenue growth forecast.

☆ Thought last year was bad for crypto? From FTX to Silvergate, the red flags are flying for the year ahead.
▼ + stars: | 2023-01-06 | by ( Phil Rosen | ) www.businessinsider.com time to read: +6 min

Those realizations came to head repeatedly in 2022 as crypto hacks and a wintry bear market crescendoed with the collapse of Sam Bankman-Fried's FTX. On a macro level, persistent recession fears make speculative assets such as tokens or tech stocks less enticing. More notable is crypto bank Silvergate's nearly 50% plunge Thursday, and the company's announcement it would cut 40% of its staff. Job cuts at Amazon and Salesforce signal the first necessary step in staging a turnaround for tech stocks. All told, analysts predict layoffs could catalyze a 20% rally for tech stocks in 2023.

☆ Sam Bankman-Fried says he needs some of his $450 million in Robinhood shares to fund his legal defense as he fights for control of the stake
▼ + stars: | 2023-01-06 | by ( Brian Evans | ) www.businessinsider.com time to read: +2 min

Sam Bankman-Fried is fighting for ownership of $450 million in Robinhood stock. Meanwhile FTX and BlockFi are laying claim to the shares. The stock is owned in principle by Bankman-Fried and FTX co-founder Gary Wang, and was purchased through Emergent Fidelity Technologies. Bankman-Fried and Wang used borrowed funds from Alameda Research to make the purchase which has been previously documented. Meanwhile, BlockFi's stated ownership of the shares of Robinhood stem from claims that the terms of a loan from BlockFi to FTX used the shares as collateral to guarantee repayment.

☆ Inside the 'Fly Fleet': billionaire Google founder Sergey Brin's growing flotilla of megayachts, boats, and jet skis
▼ + stars: | 2023-01-06 | by ( Rob Price | Hugh Langley | ) www.businessinsider.com time to read: +3 min

In a quiet harbor in California's Redwood City, 30 miles south of San Francisco, there often sits a gleaming 40-meter yacht flying the flag of the Marshall Islands. Along with Butterfly, which often docks in Redwood City, California, Brin maintains a growing flotilla of yachts, jet skis, and skiffs. To maintain the fleet, Brin employs a 50-person team around the globe, led by the master mariner Mike Gregory. InsiderMany of Brin's smaller water-sports toys — as well as Page's — have been supplied by Kai Concepts, a startup that builds high-tech aquatic vehicles, including foilboards and a kite-propelled boat. While he spends much of his time at his collection of tropical islands around the world, he has sold his superyacht Senses and downsized to an assortment of smaller vessels.

☆ FTX spent nearly $7 million on food and over $15 million on luxury Bahamian hotels in just 9 months, court documents show
▼ + stars: | 2023-01-06 | by ( Pete Syme | ) www.businessinsider.com time to read: +4 min

FTX's Bahamian entity spent nearly $40 million on hotels, food, and travel in just nine months. They show the company spent almost $6 million at a single hotel and $1 million on one caterer. Lawyers pointed out that the crypto exchange's Bahamian company, FTX Digital Markets, generated no customer revenue, but spent lavishly. From January to September 2022, the company spent $15.4 million on luxury hotels and accommodation, the filings say. Almost half of that was spent on catering services, with the largest amount, $1.4 million, spent on catering at the Hyatt.

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