3 months ago 2 min read

To Secure the Blockfolio Deal, FTX Used FTT


• For the Blockfolio contract, FTX almost forked up $84 million in 2020.
FTX's former CEO was freed on bond.

• FTX native token FTT was classified as a security by the US SEC.

After the FTX bankruptcy, fresh information concerning the once-second-largest bitcoin exchange keeps surfacing. According to a story from Bloomberg yesterday, FTX used its native token FTT to secure the Blockfolio deal. The agreement gave FTX a 52% ownership part in the platform.

According to Bloomberg, FTX paid around $84 million to acquire the bulk of Blockfolio in 2020, which was one of the biggest cryptocurrency acquisitions at the time. A cryptocurrency that FTX generated called FTT tokens was used to pay out almost 94%.

The largest crash in bitcoin history occurred on November 11. Millions of angry consumers are owed money by FTX, which was previously the second-largest cryptocurrency exchange platform in the world and had a peak market value of $32 billion (USD).

The shareholder rights litigation company Schall Law firm declared on December 15 that it would begin looking into claims made by FTT investors against FTX for breaking securities regulations. All FTT investors were asked to furnish information about their FTT transactions by the law firm. With FTX's abrupt collapse, more than 1 million investors lost their investments.

Former CEO of FTX Was Freed on Bail

The former CEO of FTX was reportedly detained in the Bahamas on December 13, 2023, according to the US attorney general. He was recently released on a $250 million bond package while he had to wait for trial in the US for committing criminal fraud connected to the demise of FTX, according to US prosecutor Damian Williams, "at the request of the US government, based on a sealed indictment filed by the United States Attorney's Office for the Southern District of New York."

On December 21, American lawyer Damian Williams announced that former Alameda Research CEO Caroline Ellison and FTX CTO Gary Wang have admitted to deceiving FTX investors.

Samuel Bankman-Fried, the founder of FTX, will be extradited to the United States, and the former CEO of Alameda Research and the former chief technology officer of FTX have both admitted guilt, the US Attorney for the Southern District of New York tweeted.

The Securities and Exchange Commission of the United States (SEC) declared the FTX native token FTT to be a "security," writing in its complaint that "The large allocation of tokens to FTX incentivized the FTX management team to take steps to attract more users onto the trading platform and, therefore, increased demand for, and increased the trading price of, the FTT token."

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