Sam Bankman-Fried secretly invested in cryptocurrency news site The Block by funneling money to its CEO: Report

Sam Bankman-Fried has reportedly funded cryptocurrency news site The Block.Images by Alex Wong/Getty

  • FTX founder Sam Bankman-Fried has been secretly funding cryptocurrency news site The Block, Axios reported.

  • Bankman-Fried’s Alameda trading firm had funneled money to Block’s CEO, the report said.

  • A $16 million batch of funds has reportedly been used in part to purchase an apartment in the Bahamas for the CEO of The Block.

Sam Bankman-Fried, the disgraced founder of bankrupt cryptocurrency firm FTX and its trading arm Alameda Research, has been secretly investing in a cryptocurrency news site, Axios reported on Friday.

Axios said the news site, The Block, was funded by payments from Alameda to the site’s former CEO, Michael McCaffrey. Employees were previously unaware of the investment, Axios said, but the disclosure could raise conflict-of-interest issues. The site had never disclosed the connections, Axios reported.

Bankman-Fried did not immediately respond to an Insider’s request for comment. The Block’s editor-in-chief Sarah Kopit declined to comment when contacted by Insider.

Meanwhile, The Block’s chief revenue officer Bobby Moran said in a statement Friday that McCaffrey had stepped down from the company and Moran had stepped into the role of CEO.

“Just before Thanksgiving, Mike told me that in early 2021 he was considering ways to merge, sell or refurbish The Block,” Moran wrote in a blog post. “Mike decided to restructure The Block by obtaining funding in the form of loans from Sam Bankman-Fried to LLCs that Mike owns and controls. Those $27 million in loans were from Alameda Research, and the funds were used to carry out restructuring and provide working capital directly to The Block”.

He added: “This news has come as both a shock and a disappointment to The Block’s management team. Mike’s decision to take out a loan from SBF and not disclose such information demonstrates a serious lack of judgment. It undermines reputation and credibility of The Block, especially that of our journalists and researchers, as well as our efforts at industry-leading transparency.”

A $16 million round of funds from Alameda was used in part to buy a Bahamian apartment for McCaffrey, Axios reported. McCaffrey did not immediately respond to a request for comment.

FTX filed for bankruptcy last month and Bankman-Fried stepped down as CEO. He tweeted on Friday that he would agree to testify before a House committee on the collapse of FTX next week. He denied the fraud allegations.

Read the original article on Business Insider

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