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FTX Accused of Unrelated Financial Expenditures
FTX, a renowned crypto exchange, has reportedly been spending millions on non-crypto-related, niche projects, as per the latest revelations from the firm's restructuring chief, John Ray. This includes a surprising investment in a property, whimsically referred to as the "Pineapple House," with an estimated value of $1.8 million.
In a comprehensive report published on June 26, Ray outlined the purported misuse of funds meant for FTX customers.
Unconventional Charitable Contributions by FTX
The document highlights supposed "charitable" contributions made by Sam Bankman-Fried, FTX’s co-founder, and other previous executives under the auspices of the FTX Foundation, the company's nonprofit branch.
Specifically, FTX Foundation granted an astonishing $700,000. The report claims $400,000 of this amount went to an organization producing animated videos on YouTube, centered around rationalist and effective altruism concepts.
An additional $300,000 grant was awarded to a person tasked with penning a book exploring the nature of human utility functions.
Ray pointed out that these "grants" were financed through FTX customer funds, intermingled within multiple bank accounts managed by FTX, Alameda Research, and various other groups.
The "Pineapple House" and FTX's Real Estate Ventures
Among the allegations, a real estate property tagged as the "Pineapple House," valued at $1.8 million, stands out. It's listed as a part of FTX's $243 million real estate portfolio in the Bahamas, allegedly purchased with customer funds.
Sotheby's, an international broker, records a property with a similar name in the Bahamas. However, it's unclear if this is the exact "Pineapple House" mentioned in Ray's report.
Further Allegations on Misused Funds
The report doesn't stop there. Ray further outlined the alleged misuse of the mixed customer funds. Notably, around $20 million was transferred to a nonprofit organization, Guarding Against Pandemics, and its associated entities.
As its moniker suggests, Guarding Against Pandemics focuses on investments aimed at preventing pandemic situations like COVID-19, based on the information available on its website.
Ray noted that the organization closely cooperates with Guarding Against Pandemics PAC, a political action committee steered by Gabe Bankman-Fried - Sam Bankman-Fried's younger sibling.
