bankman

Sam Bankman-Fried’s sudden turn from white knight to detainee

By Hannah Lang

(Reuters) – The sudden fall from grace and arrest of FTX’s former CEO Sam Bankman-Fried has stunned investors and crypto enthusiasts who once hailed the 30-year-old American as the savior of the industry.

Bankman-Fried was charged by the U.S. Securities and Exchange Commission (SEC) on Tuesday with defrauding investors in what regulators called “a house of cards,” hours before he was set to appear before a magistrate in the Bahamas.

The fallen crypto entrepreneur was arrested by Bahamian authorities late on Monday at the request of the U.S. government, U.S. Attorney Damian Williams said in a statement. The Bahamian attorney general said in a separate statement the United States was likely to request his extradition.

Bankman-Fried amassed billions of dollars in personal wealth running FTX, one of the world’s largest crypto exchanges that was valued earlier this year at $32 billion.

Since stepping down, Bankman-Fried has said he no longer has a role at the company. Yet he also told a Vox reporter he believed FTX’s bankruptcy filing was a mistake and has suggested on Twitter and in media interviews that he can still raise liquidity to repay customers. He did not specify how he planned to

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December 16, 2022 by ATTORNEY

BlockFi lawyer tells court priority is to ‘maximize client recoveries’

BlockFi lawyer tells court priority is to ‘maximize client recoveries’

In this photo illustration, the BlockFi logo seen displayed on a smartphone.

Rafael Henrique | Sopa Images | Lightrocket | Getty Images

BlockFi plans to reopen withdrawals as part of an effort to “maximize client recoveries,” the crypto lender’s lawyers said at a court hearing Tuesday, a day after the firm filed for Chapter 11 bankruptcy protection.

BlockFi’s lawyers at that hearing expressed optimism that the firm is in good position to restructure and salvage the business through the bankruptcy process.

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“We want to make sure we get people back as much of their value as quick as we can,” said Josh Sussberg, a partner at BlockFi’s legal firm Kirkland & Ellis.

BlockFi’s collapse was precipitated by exposure to Three Arrows Capital — which filed for bankruptcy protection in July — and to Alameda Research, the FTX trading arm that borrowed hundreds of millions of dollars from BlockFi. FTX had arranged a rescue plan for BlockFi, but that fell apart when FTX faced its own liquidity crisis earlier this month and rapidly sank into bankruptcy.

BlockFi loaned $671 million

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November 30, 2022 by ATTORNEY

Lawyers Detail the ‘Abrupt and Difficult’ Collapse of FTX in First Bankruptcy Hearing

“You have witnessed probably one of the most abrupt and difficult collapses in the history of corporate America,” an attorney for FTX said during the company’s first bankruptcy hearing in Delaware on Tuesday.

James Bromley of Sullivan and Cromwell, representing FTX, detailed the company’s rise and collapse in a brief presentation during the hearing, explaining how the company fell apart within the course of two weeks after bankman-frieds-crypto-empire-blur-on-his-trading-titan-alamedas-balance-sheet/” data-ylk=”slk:a CoinDesk report” class=”link “a CoinDesk report showed that Alameda Research, a subsidiary of the overall FTX group, held an unexpectedly large amount of FTT tokens, issued by FTX itself.

There are over 100 different debtors tied to the FTX group that filed for bankruptcy, another attorney said.

Bromley called the case an “unprecedented matter,” tacitly acknowledging the chaos of FTX’s bankruptcy, which saw a hack the night it filed for bankruptcy and several days before typical first-day filings were available.

The new team at FTX, including new CEO John Ray III, has “assembled a team of investigators,” which includes former enforcement officials with the Securities and Exchange Commission, Commodity Futures Trading Commission and former prosecutors, Bromley said. FTX has also retained crypto analytics firm Chainalysis to help it investigate

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November 26, 2022 by ATTORNEY

Cryptocurrency exchange FTX hurtles toward bankruptcy

The crisis engulfing Sam Bankman-Fried’s FTX.com is rapidly worsening, with the onetime crypto wunderkind warning of bankruptcy if his firm can’t secure funds to cover a shortfall of as much as $8 billion.

Bankman-Fried informed investors of the gap on Wednesday, shortly before rival exchange Binance abruptly scrapped a takeover offer. He said FTX.com needed $4 billion to remain solvent and is attempting to raise rescue financing in the form of debt, equity, or a combination of the two, according to a person with direct knowledge of the matter.

“I f—ed up,” Bankman-Fried told investors on the call, according to people with knowledge of the conversation. He said he would be “incredibly, unbelievably grateful” if investors could help.

An FTX representative declined to comment.

The acknowledgment of his firm’s deepening troubles and limited options is a stunning turn for Bankman-Fried, who was once worth $26 billion and likened to John Pierpont Morgan. It also underscores the uncertainty hanging over FTX, its clients and crypto markets.

US authorities are investigating FTX, the vast bulk of Bankman-Fried’s wealth has evaporated and rivals are benefiting from his woes. Robinhood Markets Inc. has seen its biggest crypto inflows ever in the last two days,

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November 17, 2022 by ATTORNEY
December 2024
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