SBF attempted to destabilize the crypto market in order to protect FTX

by Dec 11, 2022CryptoNews0 comments

Alameda Research’s trades were purportedly focused on depeg Tether’s stablecoin. According to sources on December 9, Tether executives and Binance CEO Changpeng “CZ” Zhao were concerned that Sam Bankman-Fried SBF, former FTX CEO, was seeking to disrupt the crypto market in order to salvage the now-bankrupt exchange.

Messages from a Signal group conversation titled “Exchange coordination” uncovered by The Wall Street Journal indicate a dispute between CZ and SBF on Nov. 10 concerning Tether’s stablecoin USDT.

According to the article, CZ and others in the group were concerned that Alameda Research’s moves might depeg the stablecoin, causing a ripple effect in crypto values. According to reports, Binance CEO approached SBF:

“Stop trying to depeg stablecoins. And stop doing anything. Stop now, don’t cause more damage.”

In a reply to the WSJ, SBF refuted the allegations. Among those in the Signal group are Kraken co-founder Jesse Powell and Paolo Ardoino, chief technical officer of Tether.

The reported altercation occurred just one day after Binance stated that it would not bail out its ailing competitor FTX, citing “claims surrounding mismanaged client cash and purported US government investigations.” Tether’s Ardoino also stated on November 10 that the business has no “plans to invest or lend money to FTX/Alameda.”

According to Cointelegraph, additional information concerning the failed deal between Binance and FTX was published on December 9.

CZ reacted to Bankman-Fried as a “fraudster” on Twitter, claiming that Binance abandoned its investment in FTX in July 2021 after feeling “increasingly uncomfortable with Alameda/SBF.” According to Binance’s CEO, SBF was “unhinged” when the exchange pulled out.

SBF responded by claiming that Binance “threatened to walk at the last minute,” accusing CZ of lying about his participation in the transaction.

See also  Nigeria is planning to approve a law recognizing cryptocurrencies.

On November 11, FTX Group and over 130 firms filed for bankruptcy in the United States, alleging a “liquidity constraint,” including FTX Trading, FTX US, under West Realm Shires Services, and Alameda Research.

SBF has been mentioned in seven class action lawsuits and other probes and investigations since FTX’s bankruptcy, including a market manipulation probe by federal authorities.

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