SBF, the disgraced founder of bankrupt cryptocurrency exchange FTX, personally took $300 million out of the $420 million raised in the company’s 2021 funding round, according to a report by the Wall Street Journal (WSJ), which cited FTX financial records it reviewed as well as people familiar with the transaction.
In October 2021, FTX raised $420 million at a $25 billion valuation from 69 investors including Ontario Teachers’ Pension Plan Board, Singapore’s Temasek, BlackRock, and Sequoia.
At the time, FTX said it would use the cash injection to expand into new markets, scale its product offerings and “further establish itself as a marketplace leader.”
SBF Cashed Out $300 Million
According to the report, SBF took $300 million out of that capital and told investors at the time that the money was used to partially reimburse himself for buying out Binance’s stake in FTX months ahead of the funding round.
Three months before the funding round, SBF bought out about a 15% stake owned by Binance, which is FTX’s first outside investor. Changpeng Zhao (CZ), CEO of Binance recently tweeted that the amount of that buyout was $2.1 billion equivalent in FTT, FTX’s native token, and Binance USD (BUSD).
While it could not be determined what SBF did with the $300 million, FTX’s 2021 audited financial statements viewed by WSJ stated that “the money was kept by FTX for “operational expediency” on behalf of a “related party.”
FTX filed for Chapter 11 bankruptcy on November 11 after it faced a severe liquidity crunch on its platform. On Wednesday, John Ray III, the new CEO of FTX said via a bankruptcy filing that he found a “complete absence of trustworthy financial information” in the company.
SBF Under Regulatory Scrutiny
Meanwhile, SBF has continued to be in the news for the wrong reasons since the company collapsed earlier this month. Recently, Coinfomania reported that the United States Securities and Exchange Commission (SEC) is scrutinizing SBF’s move that helped push FTX into a liquidity crisis.
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Source: https://coinfomania.com/sbf-took-300m-out-of-the-420m-raised-in-ftxs-2021-funding-round/