The FTX saga keeps unraveling; new information sheds light on the failed company’s inside operation. Last week, John Ray, the new CEO of the trading venue and the person in charge of its bankruptcy process, revealed murky facts about the company.
A new report from Reuters expanded on FTX’s real-estate shopping spree. As Bitcoinist reported, the company bought millions of dollars in properties in the Bahamas. The real estate was intended to operate a residency for “key personnel.”
FTX Goes On Shopping Spree, Who Pick Up The Tab?
Reuters discovered that FTX, the company founder Sam Bankman-Fried, his parents, and top executives bought over $120 million in real estate since 2020. Most of the company, allegedly purchased for the FTX staff, were “luxury beachfront homes.”
The report claims that the failed crypto trading venue bought seven condominiums and other properties in exclusive locations around the Bahamas. Records from this country’s Registrar General’s Department showed that FTX Property Holdings made the purchases via FTX Property Holdings.
The crypto exchange created this entity to manage the company’s real-estate acquisitions. Its president Ryan Salame signed several deals linked to luxury properties, including a $30 million penthouse at the Albany resort, one of the most exclusive areas in the Bahamas.
The company’s founder Sam Bankman-Fried often spoke about his modest lifestyle. The former FTX CEO allegedly lived in an apartment with roommates.
However, Reuters linked him to a $2 million apartment purchase for residential use. Bankman-Fried’s parents, Stanford professors Joseph Bankman and Barbara Fried, also signed on a multi-million dollar “vacation home.”
According to the report, a spokesperson representing Bankman and Fried claims the professors are trying to return the property. They are allegedly waiting on FTX and its new management to provide instructions on returning the property.
Bankman-Fried’s parents should have provided further details on the payment method for the acquisition. The FTX drama has revolved around the company misappropriating its customers’ funds to prompt up its trading arm Alameda Research. Were any of these properties purchased with users’ funds?
1 Million Creditors Left In The Dark
The new FTX CEO participated in several bankruptcy proceedings. Regardless of his experience, he was still shocked by the failed company’s lack of financial structure and reliable information. In the first statement regarding the state of the crypto exchange, Ray said:
Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here. From compromised system integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperience, unsophisticated and potentially compromised individuals (…).
Per Reuters, over 1 million creditors face billions of dollars in losses, and millions of customers with funds locked or stolen from the platform after a bad actor hacked into its system. Recent events might go down in history as some of crypto’s darkest hours.