Scam or charity? Ex-FTX Executives Foundation Accused Of Making Profits From Employee Token Prices
An ex- FTX According to reports, the foundation of an executive turned a donation amounting to $600,000.000 in FTT tokens into $150 million. He now wants to cash out these assets.
The Wall Street Journal reportedAccording to people familiar with this matter, Ruairi Donnelly worked at FTX and its parent company while Ruairi Donnelly was there Alameda ResearchHe was a key figure in the creation of a charity foundation that promoted AI and altruism. These are the interests he reportedly shared his with Sam Bankman-Fried, disgraced founder of FTX and former CEO.
Who is Donnelly, then?
Sources claim that he was among the company’s original employees and became its chief of staff in 2019. He had no formal title at FTX or Alameda until then. He left these companies in 2020 to work for a charity foundation.
He was an early comer to FTX, which gave him some benefits. These employees were offered FTT at 5 cents per coin in 2019, before it was made available to the public for $1.
According to his lawyer, Donnelly requested that $562,000 of his salary be converted into FTT. This would have been approximately 11.2 million coins. These coins were also requested to be given as a grant to a Switzerland-based charity. Polaris VenturesDonnelly was co-founder of the foundation, according to the WSJ, citing financial statements.
According to the financial statements of Polaris Ventures and the WSJ, this is the conclusion.
“The foundation made millions selling the tokens after they started trading publicly at $1 in 2019/2020, while Mr. Donnelly still worked at FTX.”
The original name of the foundation was Center for Emerging Risk ResearchThe company was formed without any commercial interest. Polaris participated in the first round of fundraising and investments in AI companies. Anthropic In 2021. Along with Bankman Fried and Polaris, Anthropic received more money in 2022. The company’s value increased by fourfold.
According to people familiar with this matter,
“[Polaris’] Wealth is largely derived from the 2019 FTT transfer.
This is now a matter in bankruptcy court.
Ex-exec and Frozen Funds
Now, the digital assets of FTX are being frozen in the midst a bankruptcy filing and other legal proceedings. Clients and others cannot access them.
However, Donnelly’s lawyer claimed the coins that were sent to the foundation did not belong to FTX. They were intended for unpaid wages.
“To be clear, the FTT Mr. Donnelly requested to be donated in his name to Polaris was not FTX’s money.”
According to the report, which cites 2019 financial statements, Polaris received a grant for 11,850,729 FTT, but it was not mentioned that it was for employee compensation. These FTT had risen to nearly $20 million in just a year.
According to sources, Donnelly wants Polaris Ventures out of its FTX position and to sell the rights to its exchange account at cents per dollar.
Meanwhile, Donnelly’s colleague from FTX, Alameda, also donated wages in the amount of $30,000 to the foundation, “taking its total FTT at that time to 11.8million, or roughly $600,000.” The report cited the lawyer.
The exchange has frozen $30 million of the $150 million foundation assets. The majority of the foundation’s assets are in cash, crypto and investment stakes.
Polaris Ventures’ wealth was derived from FTX transactions. This is why it has issues during the FTX bankruptcy proceedings.
The original companies FTX, Alameda and Alameda are under investigation. But the exchange’s currency is also under scrutiny. FTT has come under heavy scrutiny for its manipulation potential and role in the fall of FTX, crypto lender, and other allegations. Celsius.
It’s not just investors who want to get out. Ex-employees want to get out of the boatwreck, just like Donnelly. Adam Cole Jacobs (FTX’s former global head for payments) allegedly sold investors a $15million claim based upon a severance deal. Sources say that these investors are now trying to recover the money through bankruptcy.
As reported Tuesday, a US judge brought cases against Bankman Fried, who was being represented by the Securities and Exchange Commission (SEC) Commodity Futures Trading Commission (CFTC) was placed on hold until the criminal charges against him are resolved. He argued that the outcome in criminal proceedings would likely impact the civil cases.
Find out more
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