Sam Bankman-Fried, the ex-FTX CEO, took out a loan from Alameda Research to buy $546M in Robinhood shares. An affidavit by SBF and Gary Wang shows that they took out promissory notes between April and May. More: - SBF explained in court that he borrowed the sum of $491,743,563.39, and Wang borrowed the sum of $54,638,173.71 from Alameda.
- A total of four loans were taken out from Alameda, including:
- $316,667,182.50 and $35,185,242.50 on April 30, 2022,
- $175,076,380.89 and $19,452,931.21 on May 15, 2022.
- The loans were used to fund Bankman-Fried’s Antiguan-based shell company, Emergent Fidelity Technologies Ltd.
- The company acquired a 7.6% stake in Robinhood at $648M, now worth $430M.
- BlockFi is suing Bankman-Fried’s Emergent for the Robinhood shares.
NOTE: Inside.com founder and CEO Jason Calacanis is an investor in Robinhood.
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Caroline Ellison, the former CEO of Alameda Research, said, "I am truly sorry for what I did — I knew that it was wrong," during her courtroom appearance. Ellison also confirmed that Alameda Research could withdraw money from FTX and that she worked with Sam Bankman-Fried to provide "materially misleading financial statements to Alameda's lenders." More: - Ellison and FTX co-founder Gary Wang pleaded guilty to charges laid against them ahead of SBF's extradition to the U.S.
- The court asked her to clarify: "Did you also know that it was illegal?"
- "Yes," Ellison replied.
- "I agreed with Mr. Bankman-Fried and others not to publicly disclose the true nature of the relationship between Alameda and FTX, including Alameda's credit arrangement," she explained.
- The misleading financial statements consist of quarterly balance sheets that concealed the extent of Alameda's borrowing and loans; the court transcript also confirmed that Alameda Research borrowed money freely from FTX.
- The hedge fund had an unlimited line of credit without post collateral or paying interest on negative balances.
- "I understood that FTX would need to use customer funds to finance its loans to Alameda," says Ellison.
- Ellison faces seven criminal counts, including conspiracy to commit wire fraud and money laundering.
- "I am here today to accept responsibility for my actions by pleading guilty," she concluded.
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Dmitry Medvedev, the former President of Russia, believes the use of crypto can increase in 2023. Tron's Founder, Justin Sun, affirmed Medvedev's comments by saying that when it comes down to crypto, "the best is yet to come." More: - Medvedev believes the Bretton Woods system (an international monetary agreement that standardized currency exchange rates) may fall apart, causing leading financial institutions like the IMF and the World Bank to collapse.
- The event will cause the euro and dollar to lose their dominance as global reserve currencies, triggering cryptocurrency adoption.
- The former president has made various predictions in the past, including the United Kingdom rejoining the European Union (EU), the formation of the "Fourth Reich," and a war between France and that "Fourth Reich."
- He also believed that Elon Musk could win the presidential election in numerous states, among other predictions.
- Tron's Founder, Justin Sun, agrees with Medvedev's statement that crypto adoption could increase and says China is already committing to digital currency.
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Argo Blockchain is selling its mining facility Helios for $65M. News of the sale and of Argo refinancing a loan sent its shares on the London Stock Exchange up 120%, while it also expects to resume trading on the Nasdaq in the U.S. on Wednesday. More: - Earlier this week, Argo Blockchain saw its shares suspended on the Nasdaq; the company has also entered advanced negotiations with an "unnamed third party" to support its ongoing business operations.
- The unnamed third party was revealed on Wednesday to be Galaxy Digital Holdings.
- To avoid bankruptcy, the company is refinancing loans with a new $35M line of credit with Galaxy, reducing its total indebtedness by $41M.
- The company announced it would refinance a new asset-backed loan, sending its London-listed shares soaring.
- In October, Argo planned to raise $27M, which was unsuccessful.
- The London-listed shares of Argo had plummeted 92% in 2022 before today's big rise.
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Gemini Trust Co. founders Tyler and Cameron Winklevoss face a class-action lawsuit. Investors accused the company and founders of selling unregistered securities. More: - Gemini abruptly suspended withdrawals for Earn last month; the company offered interest of up to 7.4% to customers for lending their crypto assets.
- Investors claim that the company did not register those assets as securities in compliance with U.S. securities law and are being sued for fraud.
- The lawsuit was filed at the U.S. District Court for the Southern District of New York on Tuesday.
- Genesis and its parent company Digital Currency Group (DCG), owe Gemini Earn users $900M.
- Gemini shared an update on Tuesday, claiming that the company "continued to work through the Christmas holiday towards a resolution."
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U.S. prosecutors are charging Avraham Eisenberg for attempting to steal $110M of cryptocurrency on Mango belonging to investors. Mango is a decentralized cryptocurrency exchange that allows investors to borrow, swap, and use leverage to trade cryptocurrency assets. More: - Eisenberg is accused of commodities fraud and manipulation for withdrawing funds from the exchange with no intent to repay investors.
- On Oct. 11, Eisenberg used two accounts to buy and sell futures using the value of the MNGO token and stablecoin USD coin.
- He artificially inflated the price of MNGO relative to USDC, allowing him to borrow and then withdraw $110M of different cryptocurrencies, according to court documents.
- Eisenberg was arrested in Puerto Rico on Monday night and claimed responsibility for the trading.
- He argues that the attack on the crypto exchange was "legal open market actions."
- He released a statement on Twitter saying, "the exchange this took place on, Mango Markets, became insolvent."
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 |  | Gia Mattu is based in Calgary, Alberta. She is an entrepreneur with experience in climate technology, drones, AI, machine learning, and blockchain technology. When she's not working, she loves to hike the Canadian Rockies, try new cuisine, and travel. | | | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 and 1972 Fords. | |
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