<p>The post <a rel="nofollow" href="https://coinpedia.org/news/alameda-researchs-shocking-confession-confidential-audio-reveals-misuse-of-ftx-user-deposits/">Alameda Research’s Shocking Confession ; Confidential Audio Reveals Misuse of FTX User Deposits</a> appeared first on <a rel="nofollow" href="https://coinpedia.org">Coinpedia Fintech News</a></p> 
<p>In an important turn of events, a confidential audio recording from <a href="https://www.bloomberg.com/news/articles/2023-10-13/sam-bankman-fried-ftx-fraud-trial-audio-photos-and-messages-used-as-evidence?utm_source=website&amp;utm_medium=share&amp;utm_campaign=twitter#xj4y7vzkg">bloomberg </a>has revealed the instance when former employees of Alameda Research became privy to a shocking revelation: the firm had been “borrowing” from the deposits of FTX users.</p> 
<h2 class="wp-block-heading" id="h-behind-closed-doors-alameda-s-confession"><strong>Behind Closed Doors: Alameda’s Confession</strong></h2> 
<p>During a comprehensive meeting in Hong Kong on November 9, 2022, Caroline Ellison, the erstwhile CEO of Alameda, shared startling details with her team. The firm had been discreetly sourcing funds through open-term loans, directing them into various hard-to-liquidate investments, many of which were tied to FTX and its American counterpart.</p> 
<p>This activity led to a significant number of Alameda’s loans being recalled, compelling the firm to draw a considerable sum from FTX. This resulted in a drastic depletion of FTX user funds. Ellison admitted that Alameda had been consistently permitted to borrow from FTX users.</p> 
<h2 class="wp-block-heading" id="strong-christian-drappi-from-developer-to-key-witness-strong"><strong>Christian Drappi: From Developer to Key Witness</strong></h2> 
<p>One of the key figures during this revelation was Christian Drappi, a software developer who had worked with Alameda for over a year. Drappi’s interrogation at the courtroom followed a lengthy testimony from Ellison. Up until the eve of the meeting, Drappi, alongside numerous Alameda staff, remained uninformed about the company’s actions of allegedly using FTX deposits to boost its trading endeavors.</p> 
<p>In the recording, a discernibly unsettled Drappi can be heard questioning Ellison about when she realized that the company was wrongfully using FTX user deposits and who among the firm’s upper echelons was aware of this move.</p> 
<h2 class="wp-block-heading" id="strong-the-collapse-preceding-a-bankruptcy-strong"><strong>The Collapse Preceding a Bankruptcy</strong></h2> 
<p>Aditya Baradwaj, an engineer from Alameda Research, expressed the intense atmosphere during the meeting, noting that Ellison divulged a slew of unprecedented information, including a then-scrapped plan of FTX’s acquisition by its largest competitor, Binance.</p> 
<p>This cascade of revelations solidified the belief that the company had a bleak future. In the aftermath, many chose to sever their ties with Alameda. Just two days after this revelation, the renowned cryptocurrency exchange FTX filed for bankruptcy.&nbsp;</p> 
<h2 class="wp-block-heading" id="strong-the-tweet-that-changed-everything-strong"><strong>The Tweet that Changed Everything</strong></h2> 
<p>All the aforementioned events were set into motion on a fateful evening in November when Tony Qian, Drappi’s colleague, stumbled upon a post from Sam Bankman-Fried, the founder of both Alameda and FTX, on the social media platform, then known as Twitter.</p> 
<p>The post hinted at a significant collaboration with Binance for FTX. Upon being questioned, Ellison confirmed the news, attributing FTX’s insufficient user funds to the firm’s hefty loan repayments.</p>

Alameda Research’s Shocking Confession ; Confidential Audio Reveals Misuse of FTX User Deposits

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