Blockchain data analysts at Nansen look back at the days leading up to the FTX collapse, including the transfer of $4.1 billion worth of FTT tokens between the exchange and Alameda Research.
A report shared by Nansen with Cointelegraph revealed the blockchain analytics firm’s unique observations, highlighting the close relationship between the two companies founded by Sam Bankman-Fried. The former FTX chief executive appeared in court for the first time to face a string of charges related to the collapse of FTX Group.
According to widespread reports, FTX’s collapse was triggered by initial reports that 40% of Alameda’s $14.6 billion in assets in September 2022 were in FTT tokens.
Nansen analysts revealed that they had observed suspicious on-chain interactions between FTX and Alameda before these reports came to light. Between September 28 and November 1, Alameda sent $4.1 billion in FTT tokens to FTX and continuously transferred $388 million worth of various U.S. dollar stablecoins.
On-chain data also shows that FTX holds approximately 280 million FTTs (accounting for 80% of the total supply of 350 million FTTs). The blockchain data also reflects a “significant” proportion of FTT transaction volume (in the billions of dollars) flowing between various FTX and Alameda wallets.
Nansen also emphasized that the majority of the FTT token supply (including corporate tokens and unsold non-corporate tokens) is locked in three-year vesting contracts. Analysts say the only beneficiaries of the contract are wallets controlled by Alameda.
Given that the two companies control approximately 90% of the FTT token supply, Nansen believes that these entities can support each other’s balance sheets.
The report also suggests that Alameda is likely selling FTT tokens over the counter and as collateral for loans from cryptocurrency lending companies.
“This theory is supported by historical on-chain data, where we observe large inflows and outflows between FTX, Alameda, and Genesis Trading wallets on a regular basis, with transfer volumes as high as $1.7 billion in December 2021.”
The collapse of the Terra/LUNA algorithm stablecoin and the subsequent bankruptcy of 3 Arrows Capital (3AC) may cause Alameda to have liquidity issues due to the decline in the value of FTT, resulting in FTX obtaining a secret $4 billion loan backed by FTT.
“Our on-chain data suggests this may have already happened. During the 3AC crash in mid-June 2022, Alameda sent approximately 163 million FTT to the FTX wallet, worth approximately $4 billion at the time.”
The researchers claim that the $4 billion in volume is consistent with the $4 billion in loans revealed by close associates of Bankman-Fried in interviews with Reuters.
Blockchain data also reflects that Alameda was unable to honor its November 6 offer to purchase FTT tokens from Binance for $22. Previously, Binance CEO Changpeng Zhao (CZ) announced that the exchange would dump its tokens after devaluing them. Report on Alameda’s balance sheet.
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