The CEO of Alameda Research and senior FTX officials learned that FTX had loaned its clients money to Alameda to help it meet its obligations, according to people familiar with the matter.
Alameda problems Help bankrupt FTX, a cryptocurrency exchange founded by Sam Bankman-Fried. Alameda is also a trading company Founded and owned by Mr. Bankman Fred.
In a video meeting with Alameda employees late Wednesday HK time, Alameda CEO Caroline Ellison said she, Mr. Bankman-Fried and two other FTX executives, Nishad Singh and Gary Wang, were aware of the decision. To send customer money to AlamedaAccording to people familiar with the video. Mr. Singh was the Director of Engineering at FTX and a former employee of Facebook. Previously at Google, Mr. Wang was the chief technology officer of FTX and co-founded the exchange with Mr. Bankman-Fried.
Alameda faced a barrage of requests from lenders after the collapse of crypto hedge fund Three Arrows Capital in June, causing losses to crypto brokers such as
voyager digital Ltd.
people said.
Ms. Ellison said on the call that FTX used client funds to help Alameda meet its obligations, the people said.
People said Alameda borrowed to fund illiquid investments.
On Friday, FTX, Alameda, FTX US and other FTX affiliates filed for bankruptcy protection.
Bankruptcy means that it can take a long time before individual investors and others who owe their money can get any, if any, of them back.
Ms. Ellison did not send a phone message and email requesting comment. Messrs. Singh and Wang did not respond to multiple messages seeking comment. Ryan Miller, FTX US’s chief legal officer, declined to comment.
Cryptocurrency platform FTX filed for Chapter 11 on Friday and CEO Sam Bankman-Fried has resigned. WSJ’s Vicky Ge Huang explains what happened to the company and what this could mean for investors. Photo: Olivier Doolery/AFP
Write to Dave Michaels at [email protected], Elaine Yu at [email protected], and Caitlin Ostroff at [email protected]
Copyright © 2022 Dow Jones & Company, Inc. all rights are save. 87990cbe856818d5eddac44c7b1cdeb8
More Stories
JPMorgan expects the Fed to cut its benchmark interest rate by 100 basis points this year
NVDA Shares Drop After Earnings Beat Estimates
Shares of AI chip giant Nvidia fall despite record $30 billion in sales