1 year ago
Blockfi CEO Zac Prince testified Friday that the downfall of FTX contributed to his company’s bankruptcy. Prince appeared arsenic a authorities witnesser successful the fraud proceedings of erstwhile FTX brag Sam Bankman-Fried (SBF).
Blockfi’s Prince: Loans Wouldn’t Be Approved Knowing Alameda Used FTX Clients’ Funds
Blockfi’s Prince informed national prosecutors that his institution had loaned arsenic overmuch arsenic $1.1 cardinal to Sam Bankman-Fried‘s trading company, Alameda Research. He stated that Blockfi wouldn’t person sanctioned the loans if they had been alert that Alameda was utilizing FTX lawsuit funds.
“No,” Prince responded erstwhile queried if helium knew Alameda was utilizing FTX lawsuit funds. “That’s not appropriate,” helium added. The trial’s grounds was covered by Inner City Press newsman Matthew Russell Lee and was broadcast connected the societal media level X (formerly Twitter).
The loans were backed by assets that drastically depreciated successful worth pursuing FTX’s bankruptcy, arsenic per Prince’s testimony. Blockfi had $350 cardinal stuck connected the FTX level astatine the clip of its collapse. Coupled with the problematic Alameda loans, Blockfi recovered itself successful indebtedness of much than $1 cardinal to creditors.
Prosecutors successful the Bankman-Fried lawsuit reason that SBF covertly moved lawsuit funds from FTX to offset losses astatine Alameda Research. In the trial, the authorities contends that these unauthorized transfers rendered FTX incapable of fulfilling lawsuit withdrawal requests. Prince mentioned that helium had nonstop conversations with Alameda’s apical officials astir their fiscal standing, including discussions with Bankman-Fried.
Alameda had antecedently stated that its FTX loans originated from different cryptocurrency lenders. Prince present suspects those claims were inaccurate. The authorities posits that the purported fraud by Bankman-Fried devastated companies similar Blockfi and obliterated billions successful lawsuit assets. Prince’s grounds shed airy connected the interactions betwixt FTX and Alameda.
Beyond the grounds of Blockfi’s CEO, national prosecutors presented equilibrium sheets arsenic proof. Prince’s comments came aft the testimony of Caroline Ellison, Alameda’s erstwhile CEO, who alleged that Bankman-Fried instructed her to prosecute successful fraudulent activities. Blockfi declared bankruptcy successful November 2022.
What bash you deliberation astir the Blockfi CEO’s testimony? Share your thoughts and opinions astir this taxable successful the comments conception below.
English (US) 