Report says Alameda Research “did not trade crypto,” speculators believe Sam Bankman-Fried’s political connections allowed FTX to fly under the radar

The company’s bankruptcy filing and news about Sam Bankman-Fried’s (SBF) quantitative crypto-currency trading firm Alameda Research have shed some more light on the situation. In addition, crypto supporters have questioned why U.S. regulators have let FTX fly under the radar.

The bankruptcy filing highlights FTX and Alameda’s long list of “holding companies.”

Last Friday, the general public and even FTX employees kept in the dark, were informed that FTX Trading Ltd. has filed for Chapter 11 bankruptcy in the United States. The bankruptcy filing site explains that it has more than 100,000 creditors and that the company’s liabilities are estimated to be between $10 billion and $50 billion. The bankruptcy filing is signed by FTX’s new CEO, John J. Ray III, a person who worked on the Enron bankruptcy proceedings.

The bankruptcy filing involves FTX Trading Ltd. and 134 affiliates of the debtor, including Alameda Research, Atlantis Technology, Bitpesa, Blockfolio, Cedar Bay, DAAG Trading, Global Compass Dynamics, Hawaii Digital Assets, GG Trading Terminal, Ledger Holdings Inc. and Liquid Financial, Western Concord Enterprises, FTX US Derivatives, FTX US Services, and FTX US Trading. The filing is authorized and signed by former FTX CEO Samuel Benjamin Bankman-Fried, also known as SBF.

Alameda is described as a “financial control loop”, crypto-currency trading is said to be non-existent.

While the filing was recorded on November 11, SBF’s signature on the filing is dated November 10, 2022. Of the 134 affiliates, 11 share the name Alameda with Sam Bankman-Fried’s (SBF) quantitative crypto-currency trading firm called Alameda Research. While Alameda claims to be a quantitative crypto-currency trading firm, it has been… said that Alameda did nothing of the sort.

The saga continues.@SBF_FTX Sam Bankman-Fried’s Alameda Research didn’t trade crypto so far as we can tell

What did they do then?

They “invested” $8B across 448 venture-stage startups, most of which have “1-10” employees and zero documentation. https://t.co/6JRU9yOTE7

– Lyle (@LordNefty) November 11, 2022

“Sam Bankman-Fried’s Alameda Research has not been trading in crypto as far as we can tell“, said the journalist @lordnefty wrote. “So what have they done? They ‘invested’ $8 billion in 448 early stage startups, most of which have 1-10 employees and no documentation. It only gets crazier when you dig into each of these companies.“The reporter added:

A feedback loop of financial control that ultimately results in all the money going to Sam Bankman-Fried controlled companies, companies with no owners or financial data, homepage websites, etc.

While some claim that Alameda did not actually trade digital assets, it has also been said that Bankman-Fried and Alameda traded digital assets. leveraged arbitrage schemes that trade up to $25 million per day. The web portal crunchbase.com highlights the large number of leveraged arbitrage trades. portfolio companies associated with Alameda. Additionally, on November 2, 2022, Coindesk reporter Ian Allison published an article on Alameda’s balance sheet that noted that the company held a massive amount of ftx tokens (FTT) relative to other assets held by the company.

Alameda CEO Caroline Ellison declined to comment, the report said. Alameda Research’s day-to-day affairs are managed by Ellison, Nate Parke, Charlie Tsang, Christian Drappi, Aditya Baradwaj, Oliver Hamilton and Sam Trabucco as an advisor. Ellison’s father is an MIT faculty member and expert in economics, game theory and technology adoption.

Following Coindesk’s report on Alameda’s balance sheet, Binance CEO Changpeng Zhao (CZ) said his exchange would dump its FTT tokens.

Prior to CZ’s statements, on October 31, 2022, Dirty Bubble Media (DBM) published an article on crypto trading that showed that Alameda is one of Celsius’ largest unsecured creditors and that the crypto lender owes Alameda $12.8 million. The DBM report also points out that Celsius had another major unsecured creditor called “Pharos Fund SP“.

“This fund was, as far as we could find, not publicly known before the Celsius filing. It is managed by a company called Lantern Ventures, which has also largely flown under the radar during its existence“, the DBM report explains. “According to a Bloomberg report, Lantern CEO Tara Mac Auley said she was a co-founder of Alameda Research. Mac Auley was also the CEO of a charity called ‘Center For Effective Altruism‘. Sam Bankman-Fried is a member of this charity’s affiliate organization, “Giving What You Can”.

LBRY team questions SEC’s enforcement motives, Crypto community members believe SBF was a “scapegoat” because of his extensive political connections.

Interesting. @GaryGensler runs to the media while reports to my office allege he was helping SBF and FTX work on legal loopholes to obtain a regulatory monopoly. We’re looking into this. https://t.co/SznowgcP6V

– Tom Emmer (@RepTomEmmer) November 10, 2022

The problems associated with FTX and Alameda have led a number of crypto-currency supporters to question why regulators like the U.S. Securities and Exchange Commission (SEC) didn’t catch FTX before its collapse. Congressman Tom Emmer tweeted at about allegations about the SEC chairman helping FTX gain a regulatory monopoly. The LBRY Twitter account, run by the blockchain project that lost a lawsuit with the SEC, discussed the severity of the regulator’s enforcement against LBRY, compared to FTX.

https://twitter.com/mdudas/status/1591175007576928256

“It seems more and more that while the SEC had a team of employees working to crush us, a small player and one of the real honest ones, FTX was stealing billions and Gary Gensle took the time to meet with them personally,“LBRY wrote. Bankman-Fried’s history of effective altruism, million-dollar donations to Democratic super PACs and U.S. President Joe Biden, his reported meeting with SEC Chairman Gary Gensler, and other connections have made people believe SBF was a political “patsy” designed to push crypto-currency regulations through the industry.

increasingly looking like that while the SEC had a team of staff working to crush us, a tiny actor and one of the actual honest ones, FTX was stealing billions and @GaryGensler was taking the time to personally meet with them

it’s all just so rotten

– LBRY 🚀 (@LBRYcom) November 9, 2022