FTX ex-CEO’s defence draft targeted Carolina Elison as the main culprit behind the FTX exchange downfall.
FTX was the top-ranked Crypto exchange before Nov 2022. In early Nov of last year, the exchange saw an outflow of huge amounts of money & in the end the exchange failed to withdraw all the funds on behalf of customers because there was not enough fund to pay the customers. Days later, the exchange filed for bankruptcy along with all of its 120+ subsidiaries, including FTXUS, and Alameda Research.
Recently NYTimes published a report on behalf of the FTX co-founder Sam Bankman-Fried’s (SBF) 250-page defense draft and noted that SBF believes it was her ex-girlfriend Caroline Ellison, who failed to manage Alameda Research’s funds perfectly.
Draft noted that SBF claimed that Caroline was not eligible & fully qualified for the job of Alameda Research CEO and also she refused to hedge. In short, she was not able to lead a crypto hedge firm but still, she was enjoying the position, as she was SBF’s girlfriend.
Furthermore, SBF believes that it was the Sullivan law firm that ejected all the blame on him.
Alameda Research
Alameda Research was FTX’s sister firm and grabbed huge popularity in 2021 following the surge in Alameda’s asset value by $100 billion. In 2022, under the leadership of Caroline, Alameda failed to maintain its financial position in a volatile environment. During the bad financial situation, SBF tried to maintain Alameda’s financial position via funding through FTX customers fund, SBF was the 90% owner of Alameda Research & he tried his best to save his crypto hedge firm but failed.
Before the bankruptcy of the FTX exchange, Coindesk media published a report and dragged attention toward the bad financial position of Alameda Research & FTX and also noted that these two companies were holding almost all the funds in FTX token (FTT), the exchange’s native token.
Following the report, a high panic fund withdrawal pressure started and days later another announcement by the Binance CEO linked with FTX token acted as a catalyst to create a high level of fear among the customers.
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