Alameda’s insider edge: Did SBF’s trading firm profit from buying tokens before their listing on FTX?
The epic fall of Sam Bankman-Fried’s cryptocurrency exchange FTX has rocked the crypto industry and has cost customers millions of dollars in lost crypto deposits.
While new allegations and claims continue to be exposed, Alameda Research – a quantitative trading firm founded by Bankman-Fried in 2017 – now faces new claims as to whether it conducted manipulative trading activities and profited from buying tokens before they were listed on FTX.
According to the Wall Street Journal, research conducted by blockchain analytics firm Argus alleges Alameda Research used prior knowledge of tokens that were set to be listed on FTX to purchase them ahead of the public announcements.
Omar Amjad, co-founder of Argus, told the WSJ: “What we see is they’ve basically almost always in the month leading up to it bought into a position that they previously didn’t.
“It’s quite clear there's something in the market telling them they should be buying things they previously hadn’t.”
Despite approaching FTX, there was no immediate response to our request for a comment about the allegations.
FTT to USD
Allegations between Alameda and FTX’s close allegiance are already under scrutiny, with claims financial documents show that Alameda had been dependent on being able to borrow customer assets and funds from FTX.
A further financial report showed that around $5bn of Alameda Research’s balance sheet was held in ftx token (FTT), the utility token of the FTX ecosystem.
While both Alameda Research and FTX were owned by Sam Bankman-Fried – also known as SBF – he had previously stated that the two entities remained separate.
Following the implosion of FTX and the downfall of SBF, the crypto exchange and more than 130 of its subsidiaries filed for Chapter 11 bankruptcy filings on 11 November.
1) Hi all:
— SBF (@SBF_FTX) November 11, 2022
Today, I filed FTX, FTX US, and Alameda for voluntary Chapter 11 proceedings in the US.
Bankman-Fried resigned as CEO of the FTX, with newly-appointed John Ray III set to oversee the Chapter 11 bankruptcy procedure.
Ray said in a statement published on Twitter that he will “continue to make every effort to secure all assets, wherever located”.
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