FTX Used Customer Funds Among Other Assets to Prop Up Alameda Research in May: Report

FTX founder Sam Bankman-Fried transferred at least $4 billion in funds, according to a report.

AccessTimeIconNov 10, 2022 at 8:30 a.m. UTC
Updated May 9, 2023 at 4:02 a.m. UTC
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Sam Bankman-Fried transferred at least $4 billion in FTX funds secured by assets including the crypto exchange's FTT token and shares in the trading platform Robinhood Markets (HOOD) to support Alameda Research after the trading firm suffered a series of losses from deals, according to three people familiar with its operations, Reuters reported Thursday.

A portion of the funds were customer deposits, two of the people said. The exact value of these assets could not be determined.

One of the losses Alameda faced involved a $500 million loan agreement with crypto lender Voyager Digital, the report said. Voyager filed for bankruptcy protection one month later.

FTX halted all non-fiat customer withdrawals on Tuesday after receiving $6 billion in withdrawal requests over 72 hours earlier this week. Binance CEO Changpeng "CZ" Zhao signed a non-binding letter of intent to acquire FTX to ease liquidity pressure, but he now appears to have scrapped any potential deal.

UPDATE (Nov. 10; 8:57 UTC): Switches photo from generic banner.

UPDATE (Nov. 10; 10:02 UTC): Adds details of Voyager loss. Adds context in final paragraph.

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