Anviksha Patel
Binance founder Changpeng Zhao sent FTX founder Sam Bankman-Fried a series of concerned emails a day before the now-defunct cryptocurrency exchange filed for bankruptcy, claiming that his trades were out of the industry. reportedly warned that it could destabilize the
In a Nov. 10 group chat with other crypto executives seen by The New York Times, Zhao warned Bankman-Fried that the collapse of FTX could collapse the rest of the crypto industry, the paper said. reported on Friday.
“Stop now and don’t do any more damage,” he told the infamous FTX founder, referring to trades FTX and its hedge fund offshoot Alameda were making. This prompted customers to try to liquidate nearly $5 billion in deposits, which FTX did not. Do not have.
Sam Bankman-Fried recently told Bloomberg that he “miscalculated” an $8 billion hole in FTX’s balance sheet, claiming the amount was booked twice.
Zhao told Bankman-Fried on the encrypted messaging app Signal:
Earlier that week, Zhao agreed to buy FTX assets, but later backed out of the deal.
The text also shows Zhao accusing Bankman-Fried of using his hedge fund to lower the price of the stablecoin Tether, which is pegged to $1. He said Alameda made a $250,000 deal to destabilize Tether.
Bankman-Fried responded with a confused look.
“Are you arguing that you think the $250,000 USDT trade will unpeg it?” he added.
Zhao said the $250,000 deal would not lift the stablecoin peg, but could create problems.
“My honest advice is to quit everything,” Zhao concludes. “Put on your suit and go home.” [Washington] DC, and start answering questions. ”
A Binance spokesperson did not immediately respond to MarketWatch.
Bankman-Fried did not immediately respond to MarketWatch’s request for comment, but told the New York Times: Or any other stablecoin. ”
“I’ve made many mistakes over the past year, and this isn’t one of them,” he added.
A Tether spokesperson told MarketWatch: Existence.
“We hope the events surrounding FTX show that the company’s actions do not reflect the spirit and commitment of the industry as a whole.”
Elsewhere, Bankman-Fried, colloquially known as SBF, has been the subject of numerous investigations by the Department of Justice and the Securities and Exchange Commission.
The SBF on Friday hit back at Su Zhu, co-founder of bankrupt hedge fund Three Arrows Capital, saying: “Focus on your home.
– Anviksha Patel
(Closed) Dow Jones Newswire
12-10-22 0959ET
Copyright (c) 2022 Dow Jones & Company, Inc.
