BitDAO Community Asks Alameda for Proof of Funds After BIT’s Sudden 20% Drop

Linh Nguyen — Tue, 08 Nov 2022 07:48:06 +0000

@ Crypto Insider

The BitDAO community has said that it will vote on what to do with its FTT tokens if Alameda fails to provide evidence that it continues to hold BIT tokens as promised. Alameda has promised to provide the evidence soon.

BitDAO, one of the largest decentralized autonomous organizations (DAO), entered the FTX-Alameda drama on Tuesday after the DAO’s native token BIT slipped 20%.

The community behind BITDAO, which is supported by crypto exchange Bybit, Pantera, billionaire Peter Thiel, and several other funds, asked trading firm Alameda, to prove that they continue to hold 100 million BIT tokens that they acquired in November last year by converting 3.36 million FTT tokens. The token swap deal required Alameda to hold tokens for at least three years.

“BitDAO community is questioning the sudden dump of $bit token caused by Alameda dumping and breaching the 3 yr mutual no sale public commitment. Nothing is confirmed but BitDAO community would like to confirm proof of funds from Alameda,” Bybit’s co-founder Ben Zhao tweeted.

BitDAO’s fears perhaps stem from speculation that Alameda is liquidating its other token holdings to defend FTX’s native cryptocurrency.

FTTT has dropped 40% to $15 in four days. The FTX-Alameda drama began last week after CoinDesk reported that Alameda held large amounts of FTT tokens on its balance sheet. In response, Binance moved to liquidate its FTT holdings, triggering market panic.

BitDAO community also issued a veiled threat to take action, perhaps sell the acquired 3,362,315 FTX tokens, in case Alameda does not offer clarification in 24 hours.

“If this request is not fulfilled, and if sufficient alternative proof or response is not provided, it will be up to the BitDAO community to decide (vote, or any other emergency action) how to deal with the $FTT in the BitDAO Treasury,” the proposal said.

Responding to Zhou’s tweet, Alameda Research’s CEO Caroline Ellison said, “that wasn’t us,” and promised to provide the proof of funds once things calm down. Zhou thanked Ellison for the quick response, saying “it gives a lot of confidence to the BitDAO community.

Ellison’s assurance has certainly calmed market nerves. BIT token has recovered to trade at $0.38, having dropped over 20% to $0.26 early Tuesday, data from charting platform TradingView show.

The post BitDAO Community Asks Alameda for Proof of Funds After BIT’s Sudden 20% Drop appeared first on Crypto Insider.

FTX Token Plummets as Market Fears Possible Alameda Contagion

Linh Nguyen — Tue, 08 Nov 2022 07:01:34 +0000

@ Crypto Insider

FTT has declined nearly 20% over the course of an hour, with Solana’s SOL down 17% and Serum’s SRM off 10%.

Fears over another ‘Three Arrows’ event, but this time tied to FTX and its hybrid investment fund/market maker Alameda Research, gripped the markets Tuesday morning Asia time, sending FTX’s exchange token FTT down nearly 20%.

Data from CoinGlass shows that there continues to be building short interest in FTT as open interest has surged 8% during the last hour to a total of $215 million.

The trouble for Sam Bankman-Fried’s FTX started after CoinDesk reported last week that a notable portion of Alameda’s balance sheet was made up of FTT and Solana’s SOL token.

Since then, the market has grown concerned about FTX’s liquidity. The exchange has faced a massive stablecoin exodus, with $451 million being sent off its main platform during the last week, and $15 million being pulled from its U.S. subsidiary, according to Nansen data. Currently, FTX has a balance of $59.2 million USDC and $28.5 million USDT, along with $8.6 million BUSD. FTX US has $41 million USDC, $12.8 million USDT, $39 million PAX, and $11.3 million BUSD available.

Interest rates on FTX’s margin lending platform have jumped, with the exchange now paying 10% for USDT compared to a previous lending rate of 5%.

Meanwhile, Binance has seen an inflow of $411 million in stablecoins over the last week, with a current balance of $26.7 billion.

While users have reported some delays on fiat currency withdrawals, FTX says that it is working through the backlog and they are still being processed. FTX CEO Sam Bankman-Fried took to Twitter early Monday to say that the exchange was far from insolvent and there is no risk of withdrawals being halted.

Binance CEO Changpeng Zhao has previously said that he plans to liquidate any remaining FTT on Binance’s books, but on chain data suggests that this hasn’t yet begun.

FTT is currently trading down 19% at $17.93. SOL is lower by 17% and Serum’s SRM token is down 10%. The action is spilling over into bitcoin (BTC) as well, which is down 5.6% to $19,650.

The post FTX Token Plummets as Market Fears Possible Alameda Contagion appeared first on Crypto Insider.

Alameda Archives - Crypto Insider

BitDAO Community Asks Alameda for Proof of Funds After BIT’s Sudden 20% Drop

The BitDAO community has said that it will vote on what to do with its FTT tokens if Alameda fails to provide evidence that it continues to hold BIT tokens as promised. Alameda has promised to provide the evidence soon.

FTX Token Plummets as Market Fears Possible Alameda Contagion

FTT has declined nearly 20% over the course of an hour, with Solana’s SOL down 17% and Serum’s SRM off 10%.