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Sam Bankman-Fried

Here’s What Binance’s CZ Has To Say About SBF

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The bankruptcy of reputable cryptocurrency exchange FTX has caused complete turmoil in the industry. Binance agreed to make a non-binding contribution to the troubled business earlier this month. Then, though, it quickly changed its mind and said that it was powerless to do anything about the problems.

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Binance CEO, CZ

Changpeng Zhao, the co-founder and CEO of Binance, recently lambasted Sam Bankman-Fried, the outgoing CEO of the insolvent exchange FTX. Zhao was asked to comment on a tweet sent by SBF on Thursday that referred to him as a “sparring partner” at the Milken Institute’s Middle East and Africa Summit.

Binance’s CZ Believes That SBF Should Have Worked On Other Things

Speaking on the same, CZ said,

“When he tweets about a sparring partner, his house is burning and all this is happening, he’s losing focus… That day when he tweeted that, he should have been working on other things. He should not be writing tweets.”

He further added,

“… he never told me I was his sparring partner. I’m actually not sure if that tweet was aimed at me or us (Binance).“

Further asserting that “only a psychotic can post that message,” the Binance CEO claimed that he had never seen other exchanges as direct rivals. More so because cryptocurrency was still in its infancy. He went on to say more, saying,

“We haven’t even reached 1% adoption. We can grow the industry 100x… We never view other exchanges as sparring partners or competition—it’s not a boxing match.”

Zhao clarified the situation further by claiming that Bankman-Fried was the one who approached him just as FTX was about to collapse. He continued by saying that when Bankman-Fried approached him, they knew he was “desperate.”

When SBF first contacted CZ, the latter believed he was going to request an OTC agreement to buy the FTT tokens in order to reduce market commotion. The former FTX CEO did, however, “quite rapidly indicate that they’re in significant danger, and they’re seeking for a buyout” on the call. CZ added,

“It didn’t take us very long to figure out there were way bigger problems [at FTX] than we imagined.”

FTX’s New CEO Dissociates Himself From Sam Bankman-Fried

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FTX’s current Chief Restructuring Officer John Ray who recently took control of the troubled exchange after the departure of its beleaguered founder has dissociated itself from SBF.

As stated by the exchange’s official Twitter handle, after Bankman-Fried’s resignation from FTX Official, and its, directly and indirectly, owned businesses on November 11, he no longer speaks on the behalf of the above entities.

The latest tweet follows the filing of a fresh document on Nov 14 in Delaware’s federal court, where FTX US is headquartered. The document highlighted Bankman-Fried’s stepping down and the appointment of John Jay Ray III as its new CEO.

The document also dug into Bankman-Fried’s final days as CEO of the exchange and the events that led up to the bankruptcy filings on Nov. 11.

“Questions arose about Mr. Bankman-Fried’s leadership and the handling of FTX’s complex array of assets and businesses under his direction.”

Ryne Miller, FTX US general counsel, said that in accordance with their duties specified Chapter 11 Debtors-in-Possession, both FTX US and its global platform continue to make every effort to secure all assets, wherever they may be.

Among other things, we are in the process of removing trading and withdrawal functionality and moving as many digital assets as can be identified to a new cold wallet custodian.  As widely reported, unauthorized access to certain assets has occurred.

Additionally, Miller informed that a fact assessment mitigation effort is currently underway and that they are collaborating with law enforcement and the appropriate regulators.

Meanwhile, SBF continued to draw ire for his cryptic Twitter thread that began on Nov. 14.

FTX EX CEO’s Tweets Have Gained Notoriety

With regards to his weird posts, Bankman-Fried revealed that he was “creating it up as I go” and that the series of tweets will “be more than one word.”

Bankman-Fried further blamed excess leverage for what is known as crypto’s biggest implosion since the Terra debacle. The former chief exec also stated that liquidity had been drained as a result of the market crash and bank run.

He revealed the focus now would be on raising liquidity and “make customers whole, and restart.”

Crypto Twitter remained skeptical of SBF’s pitch for securing liquidity. Some of the affected users slammed him for being in denial mode. Others accused him of running a scam when building his FTX empire.

FTX’s Collapse Prompts Urgent Regulation From French Central Bank

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In official bankruptcy filings made public on Tuesday, the defunct cryptocurrency exchange FTX described a “severe liquidity crisis,” as regulators launched investigations and demanded that rules for the stifled sector be implemented more quickly.

According to FTX’s filing with a U.S. bankruptcy court, it had appointed five new independent directors to each of its principal companies, including Alameda research, and was in contact with financial regulators.

Sam Bankman-Fried, the founder and former CEO of the exchange, claimed in a late-Monday report by the New York Times that he overgrew his company and missed warning signs of trouble at the exchange. The exchange’s demise sent shockwaves through the cryptocurrency industry.

FTX’s fall triggers French central bank to urge for regulation

Francois Villeroy de Galhau, governor of the French central bank, called for a global regulatory response to the financial uncertainty brought on by the cryptocurrency market in a speech in Tokyo.

“Let me stress that this uncertainty is why we need to regulate strongly and quickly crypto assets internationally.””The last episodes show us that we cannot allow for a second ‘crypto winter’ to still add to uncertainty and financial instability.”

After claiming on Saturday that it had discovered “unauthorized transactions” on its platform, FTX also acknowledged that it had responded to a cyberattack on November 11.

In one of the most publicized cryptocurrency meltdowns, it filed for bankruptcy protection on Friday after irrational traders decided to withdraw $6 billion from the exchange in just 72 hours, and direct competitor exchange Binance dropped a rescue plan.

FTX has appointed five independent directors to its various units, according to the filing from the company’s lawyers. Joseph Farnan, a former judge on the U.S. District Court, and Matthew Doheny will be in charge of FTX Trading.

Investigations by the U.S. Justice Department, the Securities and Exchange Commission (SEC), and the Commodity Futures Trading Commission have been prompted by the collapse of FTX, once the sweetheart of the cryptocurrency industry with a $32 billion valuation as of January.

The fall of FTX has also triggered global regulators to push for quicker regulation to avoid such an event in the future.

FTX Hack Leads To Mysterious Outflows Of Over $600M

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Late on Friday, more than $600 million in cryptocurrency vanished from the wallets of the defunct cryptocurrency corporation FTX, with no obvious reason given. Soon after, the exchange announced that it had been hacked in its official Telegram channel and advised users not to install any new updates and to delete all apps related to the exchange.

An account administrator in the firm’s Support Telegram chat wrote,

“FTX has been hacked. FTX apps are malware. Delete them. Chat is open. Don’t go on FTX site as it might download Trojans,”

Ryne Miller, general counsel for the exchange, confirmed the message.

https://twitter.com/_Ryne_Miller/status/1591281729125613570?s=20&t=Hv90HEUWoeAGxfPMu-Q60g

Various Ethereum tokens, as well as the Solana and Binance Smart Chain tokens, have left the exchange’s official wallets and transferred to decentralized exchanges like 1inch, according to on-chain statistics. It appears that both the exchange and its US venture are impacted.

Hack and FTX Filing For Bankruptcy Interlinked?

The transfers occur on the same day that the exchange formally filed for Chapter 11 bankruptcy protection after losing allegedly billions of dollars in user payments. The transfers have not been officially acknowledged by the firm’s leadership.

Numerous owners of the exchange’s wallets have also reported seeing $0 balances in their firm’s website and the firm’s US wallets. This can be due to the FTX API being unavailable.

FTX founder Sam Bankman-Fried was the target of filthy jokes and insults that were apparently included in some of the transactions. This led to quick speculation on Twitter from members of the cryptocurrency community that the funds had been syphoned off as part of some sort of attack.

Some others hypothesized that someone in Bankman-inner Fried’s circle was behind the outflows, citing the simultaneous and sophisticated hacks of the exchange and its US branch as evidence of a possible inside job. ” Multiple former FTX employees confirmed to me that they do not recognize these transfers,” Twitter sleuth ZachXBT wrote in a tweet on Friday night.

With names like “cumsock.eth” and “downsyndromemonkey.eth,” many of the transactions seemed to be trolls when the wallet address became known, seeking to have their vanity names permanently inscribed in a ledger that would likely be submitted as a court document and read aloud by a judge.

By midnight Eastern Time, FTX’s login interface was down (the website is still up), and anyone who attempted to log in received a 503 error. A 503 error occurs when the server is down, usually because it is being serviced or is not accessible.

FTX Saga: Bahamas Calls For Liquidator And Freezes Assets

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The honeymoon between FTX CEO, SBF, and the Bahamas appears to be ended. On Thursday, the West Indian country’s Securities Commission issued a directive to freeze the assets of the troubled cryptocurrency exchange FTX.

The Securities Commission of The Bahamas stated in a statement, “Today the Securities Commission of The Bahamas took action to freeze assets of FTX Digital Markets and related parties.” The commission also suspended FTX’s operation registration and requested that a provisional liquidator be appointed by the Supreme Court of The Bahamas, according to the statement.

The letter, which was shared by the Nassau Guardian on Twitter, comes after a week of difficulties for Sam Bankman-Fried, a former cryptocurrency darling, and SBF’s exchange, previously among the biggest cryptocurrency exchanges in the world.

The organization claimed to be aware of claims that FTX’s assets were handled, managed, or given to Alameda Research improperly. The commission stated that FTX Digital Markets should be placed into provisional liquidation to “preserve assets and stabilize the company” and that these activities may have been illegal.

The agency further stated,

“The Commission is committed to working with the provisional liquidator to endeavor to obtain the best possible outcome for the customers and other stakeholders of FTX.” 

On November 6, 2022, Binance CEO Changpeng “CZ” Zhao announced that the largest cryptocurrency exchange in the world was selling its holdings of FTT, the native token of competitor exchange FTX. This is when the global exchange’s problems started.

Approximately 23 million FTT tokens, valued at $529 million, were held by Binance, according to Investopedia. FTT’s value dropped by 85.6% and is currently trading at $3.43, down from $24.01 the previous week, when Binance said it was liquidating its entire investment, triggering a run on the exchange.

FTX And Bahamas: A Short Lived Love Story

After relocating from Hong Kong, SBF’s exchange inaugurated its new offices there in September 2021, citing the Bahamas as one of the few nations that have established a thorough framework for cryptocurrencies.

The Bahamas has embraced digital currency, even introducing the Sand Dollar as its official digital currency. Companies like OKX and SBF’s global exchange built headquarters in the island nation thanks to welcoming crypto rules.

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FTX CEO Sam Bankman-Fried

Sam Bankman-Fried conducted a four-day seminar in the Bahamas in May of this year while the exchange was still settling into its new home there. Along with Wall Street, other notable attendees included Tom Brady, Gisele Bundchen, Bill Clinton, Tony Blair, Andrew Yang, Orlando Bloom, Apolo Ohno, Rick Fox, Udonis Haslem, and Liam Payne from One Direction.

FTX Pro Download Page Now Unavailable on Apple App Store

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Up until a day ago, FTX was halfway through being acquired by Binance, the biggest exchange in the world. A recent report, however, indicated that Binance was probably going to back away from taking over the troubled business. Sam Bankman-Fried, the founder of FTX, also just deleted a string of tweets that guaranteed the security of all the assets on the exchange. As a result, investors have shied away from FTX.

Now to add to the chaos, it has come to light that the FTX Pro download Page is no longer available on the Apple App Store. However, users, who had already downloaded it can continue to use it normally even though the download page is no longer accessible on Apple’s App Store. The app is still available for download on Google Play. It’s unclear whether the App Store withdrew the app or if Sam Bankman-Friend’s Exchange delisted itself on purpose. That leaves crypto enthusiasts in speculation about the new development.

Sequoia Capital Reduces Its Investment In FTX To $0

The Sequoia Capital team just revealed that they were entirely devaluing their FTX holdings. Sequoia cited the exchange’s “liquidity crunch” and “solvency risk” as justifications for its decision in a letter to investors. The VC company invested over $214 million in the exchange’s worldwide and US companies last year. The VC firm stated,

“In recent days, a liquidity crunch has created solvency risk for FTX. The full nature and extent of this risk is not known at this time. Based on our current understanding, we are marking our investment down to $0.”

The venture capital firm disclosed that it had “minimal” exposure to the cryptocurrency exchange company and that it did not hold a top ten position in the fund. Sequoia said that the fund with the greatest exposure to the company, FTX, accounted for less than 3% of committed capital. According to Sequoia, the fund “remains in good form” and has realised and unrealized gains of around $7.5 billion.

The SCGE Fund, L.P. also transferred $63.5 million from FTX.com and FTX US. The ongoing problem does not directly damage the US entity as a whole, but Sequoia’s writedown highlights its lack of trust.

The firm went on to say that they conducted a “rigorous diligence process” before investing in SBF’s business and that in 2021—the year of their investment—the exchange earned over $1 billion in sales and more than $250M in operating profitability.

Additionally, the corporation promised in the message to investors that it would always conduct “deep research” and “thorough diligence.”

Is FTX CEO the strong leg of support for CFTC’s prosperous days?

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Sam Bankman-Fried of FTX concurred with CFTC Commissioner Christy Goldsmith Romero on the merits of trading disclosures and knowledge exams, but added on Twitter that they didn’t have to be crypto-specific.

In response to a Commodity Futures Trading Commission (CFTC) official’s call for the creation of a household retail investor category in order to increase consumer protections, Bankman-Fried made his remarks.

Romero tweeted,

“Establishing a household retail investor category could give them more consumer protections. For example, disclosures written in a way that regular people understand or could be used when weighing rules on the use of leverage.” 

In response, Bankman-Fried tweeted that such testing don’t have to be limited to digital currency, adding,

“100% agree on disclosures, knowledge tests, etc.” 

According to the billionaire, disclosure requirements and knowledge-based checks for a variety of intermediaries, such as futures commissions merchants, may be appropriate.

The disclosure and testing claims made by Bankman-Fried line up with FTX’s plan to introduce U.S. cryptocurrency futures. In fact, the creator of FTX tweeted that the company has already laid out a proposed knowledge exam for its U.S. derivatives product.

The CFTC recently signalled that it will not be slack with cryptocurrency as the discussion over consumer protections for cryptocurrency and how Congress should codify regulations continues. Rostin Behnam, chair of the CFTC, stated a desire for more direct control over markets.

The stance taken by Behnam is consistent with remarks made by Gary Gensler, the head of the Securities and Exchange Commission, who suggested the CTFC might have more control over specific digital currencies during a speech at Georgetown University’s Financial Markets Quality Conference in Washington.

FTX to roll out debit cards across 40 countries

In the past few months, the bear market has caused enormous loss to a large number of people. Platforms, however, continued to increase their interest in cryptocurrencies despite this. The newest agreement between Visa, a major player in payments, and the sector demonstrated this. This partnership was supported by Sam Bankman-cryptocurrency Fried’s exchange, FTX.

According to its most recent agreement, FTX anticipates launching debit cards in 40 nations. With this debit card, clients could make transactions without removing their cryptocurrency from the exchange, unlike with ordinary debit cards.

FTX Wins Auction for Voyager Digital’s Assets

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FTX and Binance were pursuing the purchase of Voyager. In July, FTX submitted a proposal for Voyager, which was turned down as a “low-ball offer.” 

Early in July, Voyager stopped allowing consumers to withdraw their money as cryptocurrency values fell. Then, as creditors of the firm in bankruptcy court, its clients were compelled to line up alongside experienced restructuring attorneys and financiers as inexperienced participants in a potentially lengthy procedure in order to recover their cash.

The assets of Voyager were put up for auction this week through the bankruptcy court. The billionaire Sam Bankman-FTX Fried’s exchange and Wave Financial, a digital asset investment company, squared off in the last round.

FTX steals the show

Sam Bankman-billionaire-founded Fried’s digital asset exchange, FTX US, won the bidding for the assets of defunct crypto firm Voyager Digital Ltd.

According to a statement released by Voyager Digital on Monday in New York, the arrangement is worth roughly $1.4 billion, made up of an “extra compensation” of about $111 million and the $1.3 billion market value of every cryptocurrency held by the insolvent company.

After the bankruptcy process is through, customers will be able to switch to the FTX US platform, according to Voyager, who also stated that the acquisition agreement would be submitted to the court on October 19 for approval.

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FTX Wins Auction for Voyager Digital’s Assets 4

The acquisition comes after multiple prior attempts by Sam Bankman’s exchange to rescue or buy Voyager. At the end of March, the New York-based network had 1.19 million funded accounts and around 3.5 million users.

After an unsuccessful attempt by Alameda Research, a trading firm connected to FTX, to save Voyager with a revolving line of credit, the company filed for bankruptcy protection in July.

Alameda said in September that it will pay back the $200 million in BTC and ETH it had acquired from Voyager by month end.

Bankman-Fried has been relentlessly acquiring struggling cryptocurrency businesses this year, snatching up millions of users and priceless technology for less than they were worth.

Earlier this year, FTX supported the cryptocurrency platform BlockFi and was considering buying out Robinhood Markets Inc.

The current auction which ended up in Sam Bankman’s favor lasted for two weeks.

Reports Suggest That FTX Is Raising $1 Billion to Ramp up Acquisitions

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FTX is trying to ramp up its expansion and acquisition spree. According to reports, Sam-Bankman Fried’s cryptocurrency exchange FTX is in discussions with potential investors to acquire $1 billion in fresh cash as it seeks to use the additional funds for financial acquisitions during the down market.

The discussions are still ongoing, and the specifics might yet alter, according to a report from CNBC on September 21 that cites persons familiar with the situation. The fundraising amount would maintain the FTX’s existing worth of almost $32 billion if it turned out to be genuine.

In addition to the $400 million raised in January, the prospective $1 billion investment round might indicate significant investor confidence in the company despite the industry’s protracted crypto winter.

FTX to expand its acquisition game

Some of the fresh funds will reportedly be used for additional dealing in the cryptocurrency field, according to unnamed sources. This is not surprising considering how active FTX and SBF’s quantitative research company Alamada Research have been throughout the bear market.

Since July, when Bankman’s exchange laid out a joint bid with Alameda to acquire troubled crypto lender Voyager Digital following its bankruptcy filing, there have been rumblings about a prospective takeover of Voyager Digital by Bankman’s exchange.

The plan was criticized by Voyager, which called it “a low-ball bid disguised up as a white knight rescue” and a move “intended to generate notoriety for itself rather than value for Voyager’s consumers” in bankruptcy court documents in New York.

The Wall Street Journal (WSJ) reported on September 20 that FTX and Binance are now the top bidders for Voyager’s assets, with FTX’s offer coming in just under $50 million and Binance’s estimated to be about the same amount. Both bids have not yet been approved, according to the WSJ, and the auction is still open until September 29.

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Reports Suggest That FTX Is Raising $1 Billion to Ramp up Acquisitions 6

An investment arm of the company called FTX Ventures announced earlier this month that it will pay an unknown sum to purchase a 30% share in Anthony Scaramucci’s asset management company SkyBridge Capital.

As part of larger aspirations to grow into Canada, the exchange also signed a deal to buy Canadian cryptocurrency platform Bitvo in June. An agreement for a $400 million revolving credit line and an option to purchase BlockFi for about $240 million was also struck by FTX US and the ailing lending company a month earlier.

FTX Clarifies: ETH Trading To Remain Open Through Out The Merge

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Bahamian cryptocurrency exchange FTX has clarified that trading on Ethereum would remain active all through the merge and will only suspend [and not halt] deposits and withdrawals of wrappers and layer 2.

These are Arbitrum One, Solana [Wormhole], and Binance Smart Chain [BSC] which will be reopened after the Merge is completed and networks return to stability, the updated blog read.

FTX deleted the original tweet which said it would temporarily disable blockchain transfers of secondary chains for ETH to ensure the settlement is clean. Nevertheless, CEO Sam Bankman-Fried a.k.a. SBF later confirmed that trading would stay unaffected.

One month ago, the crypto spot and derivatives exchange announced that ETH-related futures markets would not be impacted before the scheduled merge.

The trading platform with its headquarters in the Caribbean nation of Bahamas elucidated via a blog post that it won’t suspend or settle ether derivatives like futures and perpetual before the integration and that it plans to continue live trading throughout the event.

FTX- “We will do our best to support continuous trading”

The exchange also informed users that its Ethereum futures and perpetual contracts [ETH-0930, ETH-1230, ETH-PERP] will monitor the proof of stake in Ethereum after the Merge. “We will do our best to support continuous trading,” it added.

As per CoinGecko, FTX is the second-largest cryptocurrency exchange in terms of daily derivatives trading volume. The exchange has supported derivatives contracts worth $7.5 billion as per the latest data.

Among other crypto assets, the exchange also provides futures and perpetual contracts with ether as their underlying value.

In addition to that, data from various reports noted that the aggregate open interest of ether futures across exchanges has increased from $5 billion in mid-June to more than $7.7 billion in August.

Moving away from the existing energy-intensive proof of work [PoW] mechanism, the much-awaited ETH update is expected to increase the network’s through-put, and make it cost-effective as well as environmentally friendly.

That also means the end of the miners’ income streak, thus eliminating a huge portion of rewards for contributing to the blockchain.