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CEO Sam Bankman-Fried of cryptocurrency exchange FTX lent roughly $10 billion of its customers’ assets to its sister firm Alameda Research, also helmed by Bankman-Fried, a sum that Alameda still owes after a series of risky trades, The Wall Street Journal reported Thursday, citing anonymous sources.
Bankman-Fried, the second-largest billionaire donor to Democratic causes in the 2022 midterms according to Forbes, described the move as a poor judgment call, according to the WSJ. The outstanding loan represents more than half of the $16 billion in customer assets that FTX reportedly held.
“I f***** up, and should have done better,” Bankman-Fried tweeted Thursday as part of a thread addressing the crisis.
After a Nov. 2 report by crypto-focused news outlet CoinDesk noted an “unusually close” relationship between the two companies, including more than $5.8 billion of Almeda assets tied to FTX’s own cryptocurrency, investors began reporting difficulty withdrawing their assets from FTX, Business Insider reporter on Nov. 8. FTX halted customer withdrawals following roughly $5 billion in withdrawal requests Sunday, Bankman-Fried said Thursday, and has since rushed to raise cash, according to the WSJ.
“FTX has enough to cover all client holdings.
