Some FTX customers are required to send funds via Alameda – report
Sam Bankman-Fried Cryptocurrency Exchange FTX Reported Find one way to gain access to regulated banks by using its trading firm, Alameda Research, as a kind of intermediary.
In general, lenders are not willing to engage with crypto companies including FTX with their high-risk profile. In an attempt to solve that problem, FTX and Alameda shared a troubled relationship in which some FTX customers were required to send wire transfers through Alameda, which were allowed to have accounts at a centralized bank. focus on digital assets Silvergate Capital (SI), Bloomberg reported, citing people with knowledge of the matter.
silver gate (SI) shares, meanwhile, slide 8.8% in after-hours trading. The Federal Reserve member bank, which allows its customers to transfer fiat money like US dollars to cryptocurrency exchanges, recently revealed that exposure to FTX less than 10% of digital asset customer deposits totaling $11.9 billion as of September 30.
These people added that some FTX customers continue to send wire transfers through 2022. FTX, which filed for Chapter 11 bankruptcy protection in early November, did not immediately respond. Seeking Alpha’s comment request. The The FTX-Alameda . Relationship was one of the first and main factors that led to the blowing up of SBF’s crypto empire, so this news further highlights their financial deal amid concerns about misuse of their funds. client.
Alma Angotti, a partner at consulting firm Guidehouse, told Bloomberg: “In any book, mixing client money with partner money and other funds is a very bad practice and mismanagement. risk. “This is a complex set of circumstances and it is difficult to say at this point what was breached. That is bad risk management and at least sloppy.”
Earlier, (November 25) Morgan Stanley said Silvergate faced “multiple outcomes and risks”. from radioactive fallout FTX.