Yesterday it was announced that Alameda Research sent millions of dollars to news platform The Block. In total, it was 43 million dollars. A capital that Alameda Research only sent to the now retired CEO Michael McCaffrey.
$43 million in loans
The $43 million in loans is made up of three separate loans. The first was one for $12 million to buy out other investors. The next 15 million to keep things going and then another 16 million so McCaffrey could buy a house in the Bahamas.
It is striking that The Block employee Larry Cermak actually lost money to the implosion of FTX. About 20 percent of his portfolio went up in smoke. Larry warned people about the fall of the stock market, but was too lazy to take his money from the stock exchange. He wrote:
“Biggest daily loss ever for me. Funny, because I was actively telling people to pull their funds off the platform […] however, I was too lazy to do that myself,” says Cermak.
“I can live with the loss, but what annoys me is how much I haven’t been able to read the situation,” said The Block’s lead researcher. If you miss this kind of thing as the lead researcher of a new platform, then you may need to rethink your qualities. Bitcoin was conceived as an asset to be held off exchanges precisely for these reasons.
Cermak paid his own salary
If we are to believe Cermak’s words, he lost during the collapse of FTX as much as he earned in the past 4 years at The Block. Eric Wall pointed out this ironic situation. “1. Cermak is a customer of FTX 2. FTX uses user funds to fund things 3. FTX funds The Block 4. Cermak receives its salary from funding from FTX,” Wall writes.
Perhaps The Block could have survived without FTX’s funds, but it must feel strange for Cermak. In a sense he is paid by himself and the other users of FTX. As icing on the cake, it was also himself who leaked the loans his boss received from FTX, which he indicates in the tweet above.