The dust after one of the most dramatic crashes in the crypto industry is starting to settle. But the information that the companies in which FTX and Alameda Research invested may also find themselves in uncertainty is being heard more and more often.
The fortune of former FTX CEO Sam Bankman-Fried (SBF) dropped from $16 billion to almost zero overnight. Shortly before that, it reached a staggering $26 billion. But everything collapsed after the FTX group filed for Chapter 11 bankruptcy last week.
The Bloomberg Billionaires Index now estimates the American FTX division, in which Bankman-Fried owns about 70%, at $1 billion. But you should know that the influence of SBF in the crypto industry went far beyond FTX, Alameda and FTX.US .
Due to the connection with FTX and Alameda, all these companies are now at particularly high risk.
FTX and Alameda Actively Invested in crypto companies
Crunchbase data sheds light on the investments made by SBF and related companies. Alameda Research was responsible for 184 transactions, FTX Ventures – for 48, and the FTX exchange – for 21.
The last FTX investment was made on August 29. Limit Break gaming company has raised $200 million from FTX and other investors, including Coinbase Ventures, Anthos Capital, SV Angel and Sherwin Pishevar. Limit Break is known for its collection of non-fungible DigiDaigaku tokens (NFT).
BlockFi platform was one of the first victims
Bloomberg reports that the echoes of the collapse of the Sam Bankman-Fried empire continue to spread across financial markets and threaten the future of landing platforms such as BlockFi Inc.
On November 14, BlockFi admitted that it was having problems due to the collapse of FTX. The company also had obligations to Alameda Research stored on FTX.com assets, and a credit line for FTX.US .
“Given that FTX and its affiliates are currently going through bankruptcy proceedings, the most reasonable solution for us, in the interests of all customers, would be to suspend the platform’s activities.
Rumors that most of BlockFi’s assets are stored on FTX are not true. However, we bear significant risks due to FTX and related corporate structures, assets stored on FTX.com , and unused funds from our credit line to FTX.US “.
Despite this, there are rumors on Twitter about the potential bankruptcy of BlockFi. Our interlocutor did not comment on this particular issue.
It’s no secret that FTX and its venture capital division have invested in a large number of companies. On November 10, The Information reported that SBF has invested more than $500 million in funds managed by Sequoia and other venture capital firms.
But if FTX and Alameda received project tokens as a result of transactions, they may be blocked due to filing for bankruptcy. This is one of the reasons why crypto companies acted quickly, trying to “unravel” their relationship with FTX. Some even took drastic measures to rectify the situation.
For example, LayerZero Labs, the company behind the LayerZero compatibility protocol, bought out its stake from FTX and Alameda just a day before they filed for bankruptcy.
In an address to investors on November 10 , Brian Pellegrino , co – founder and CEO of LayerZero Labs , wrote:
“For the last 72 hours, we have been working on structuring the agreement and bought 100% of their shares, token orders, as well as all agreements between us from FTX/FTX Ventures/Alameda.”
The company behind the Sui blockchain, Mysten Lab, has raised ~$300 million under the leadership of FTX Ventures. And the first-level blockchain platform Aptos received $150 million in funding from FTX Ventures and Jump Crypto.