FTX Saga Timeline Week 2 - It Gets Crazier After All

Daily Bullets: Monday, November 14th

Nov 14, 2022

The aftermath of the FTX implosion will dominate the news cycle for days and weeks to come. So many dirty little details will inevitably come out. We've already seen countless stories and inside looks shared by ex-employees and surely there are still bombs waiting to drop. Not only did they implode - to add insult to injury, FTX was hacked
It's difficult to keep up with all the noise, so make sure to follow along for our ultimate timelines covering everything you'll need to know about the aftermath
How much worse do you think it'll get before it gets better?

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Ultimate FTX Saga Aftermath Timeline - Week 2

Weekend Summary:

FTX & FTX.US declares bankruptcy & FTX.US halts withdrawals
Missing funds range between $10B - $50B
Galois Capital has $100M stuck on FTX. 50% of total holdings
FTX exploited (~ $450M) funds moved to drainer wallet
White hack rescue (~ $200 M)
FTX app, website potentially updated with possible malware/trojans. Recommend to delete
FTX drainer wallet begins swapping PAXG for ETH
Minimum $1B of client funds missing
Alameda & FTX executives allegedly aware FTX was using customer funds
FTX wallet drainer moving funds on BSC
FTX only had $900M in liquid assets backing $9B in debt
CZ says he will be more critical of industry rivals going forward
FTX wasn’t allowed to reopen local withdrawals by Bahamas securities regulator
Crypto.com accidentally sent $400M (80% of ETH reserves) to Gate exchange on Oct. 21
Miami to remove FTX name from iconic downtown stadium
SBF built a "backdoor" to his FTX exchange in an effort to change financial records and move funds without alerting others
Solana-based gaming metaverse Star Atlas saw its cash runway cut in half after the collapse of FTX
Hedge fund Galois capital has almost half of its funds stuck on FTX
F1 team Mercedes-AMG Petronas suspended its sponsorship deal with crypto exchange FTX
Animoca Brands reveals 'limited' FTX exposure
Celsius revealed it has 3.5M Serum tokens on FTX as well as $13M in loans to Alameda
Crypto lender Voyager reopened the bidding process for its assets after the bankruptcy of FTX
Crypto exchange Crypto.com holds 20% of its reserves in the Shiba Inu token
Crypto.com accidentally sent $400M in ETH to Gate exchange
Wrapped tokens on Solana no longer redeemable after FTX/Alameda bankruptcy
Jump Crypto’s exposure to FTX was managed and remains well capitalized
Paradigm marks down FTX investment to zero
Huobi revealed holdings of $3.5B in hot and cold wallets for the sake of transparency
Kraken froze accounts owned by FTX/Alameda and claims to maintain full reserves
FTX had 192M FTX tokens (~$400M) minted by its deployer contract
Binance halted FTT deposits as the new tokens mysteriously flooded the market
GameStop to end its relationship and its pilot gift card marketing partnership with FTX.US
Binance to launch an industry recovery fund to help crypto projects facing liquidity crunches
Tron founder Justin Sun and investor Simon Dixon to support the initiative
Crypto.com CEO claims FTX exposure was limited to $10M
Crypto exchange AAX suspended withdrawals and denied rumors its due to the fallout of FTX
Chiliz allocates 38M CHZ to compensate individual users unable to withdraw CHZ on FTX
Visa terminates global debit card agreements with FTX
Japan has asked FTX Japan to cease operations by December 9, 2022
Singapore was the 2nd largest source of FTX users but FTX was not licensed to operate
Users are fleeing exchanges and turning to non-custodial wallets amid FTX’s collapse
Binance shutting down FTT trading except with BUSD and closing off FTT shorting ability
Hbit Limited has $18.1M stuck on FTX. $14M loan from ex-Huobi CEO to cover client funds
Binance US, Coinbase, and Curve in a bidding war for BlockFi's credit card customers
OKX SRM/USDT Perpetual Swap will be delisted
Binance will cooperate with Vitalik to launch a new platform reserve proof method
Kraken, Coinbase and Gate.io publish proof of reserves with liabilities
Multicoin Capital's third VC fund has exposure of more than $25M to FTX
U.S. federal law enforcement ordered Paxos to freeze $19M tied to the bankrupt FTX
Hedge fund Ikigai Asset Management had a "large majority" of its assets on FTX

Now for a more expanded and detailed look at the day…

⛓ Crypto News:

Tokensoft, a chain-agnostic token launch platform, has doxxed over 4000 of its users alleging that the named users were ‘gaming’ the Tokensoft DAO’s airdrop

Chainlink Labs offers proof-of-reserve service for embattled exchanges

The Klatyn Block Reward Adjustment has been reflected in both the Baobab and Cypress network

Polkadot Academy is coming to Buenos Aires + ecosystem update

👨‍⚖️ Economic/Government/Regulatory:

Politicians are calling for regulation left and right

💸 Exchange News:

Several wallets allegedly belonging to FTX were drained of hundreds of millions of dollars in coins late on Friday night

Miami to remove FTX name from iconic downtown stadium

SBF built a "backdoor" to his FTX exchange in an effort to change financial records and move funds without alerting others

Solana-based gaming metaverse Star Atlas saw its cash runway cut in half after the collapse of FTX

Hedge fund Galois capital has almost half of its funds stuck on FTX

F1 team Mercedes-AMG Petronas suspended its sponsorship deal with crypto exchange FTX

Animoca Brands reveals 'limited' FTX exposure

Celsius revealed it has 3.5M Serum tokens on FTX as well as $13M in loans to Alameda Research

Crypto lender Voyager has reopened the bidding process for its assets after the bankruptcy of FTX

Crypto exchange Crypto.com holds 20% of its reserves in the Shiba Inu token

Crypto.com accidentally sent $400M in ETH to Gate exchange

Wrapped tokens on Solana are no longer redeemable after issuers FTX and Alameda Research filed for Chapter 11 bankruptcy protection

Jump Crypto’s exposure to FTX was managed in accordance with its risk framework and remains well capitalized

Paradigm marks down FTX investment to zero

Huobi revealed holdings of $3.5B in hot and cold wallets for the sake of transparency

Kraken froze accounts owned by FTX Group, Alameda Research and their executives and claims to maintain full reserves

FTX had 192M FTX tokens (~$400M) minted by its deployer contract and Binance halted FTT deposits as the new tokens mysteriously flooded the market

GameStop to end its relationship and its pilot gift card marketing partnership with FTX.US

Binance will launch a new industry recovery fund to help crypto projects facing liquidity crunches and opened the door for investors to contribute to the fund. Tron founder Justin Sun and investor Simon Dixon to support the initiative

Crypto.com CEO claims FTX exposure was limited to $10M - an external audit report is planned in a few weeks to verify its balance sheet

Hong Kong-based crypto exchange AAX suspended withdrawals, citing a glitch in a system upgrade and denied rumors of the withdrawal pause being due to the fallout of FTX

Chiliz allocates 38M CHZ to compensate individual users unable to withdraw CHZ on FTX

Visa terminates global debit card agreements with FTX

Japan has asked FTX Japan to cease operations by December 9, 2022

Singapore was the second largest source of FTX users but FTX was not licensed to operate in the country

Users are fleeing exchanges and turning to non-custodial wallets amid FTX’s collapse

Binance shutting down a FTT trading pairs and contracts except with BUSD and closing off the ability to short FTX’s token

Hbit Limited, a fully owned subsidiary of New Huo Technology, has approximately $18.1M worth of assets stuck on FTX - gets $14M loan from ex-Huobi CEO Leon Li to cover client funds

Binance US, Coinbase, and Curve are in a bidding war for BlockFi's credit card customers

FTX clarification on certain entities not included in chapter 11 filings

OKX SRM/USDT Perpetual Swap will be delisted

Binance will cooperate with Vitalik to launch a new platform reserve proof method with Binance serving as a pilot

Kraken, Coinbase and Gate.io publish proof of reserves with liabilities

Solana ecosystem facts related to FTX bankruptcy

Multicoin Capital's third VC fund has exposure of more than $25M to FTX

U.S. federal law enforcement ordered crypto issuer Paxos to freeze $19M worth of crypto tied to the bankrupt FTX
Hedge fund Ikigai Asset Management had a "large majority" of its assets on FTX

Aleph Zero (AZERO) listed on KuCoin

🏦 DeFi News:

Solana developers are forking FTX-developed token liquidity hub Serum after it may have been compromised in a hack on FTX

DEXs Trading volumes hit $32B over 7 days - sees increase following loss in trust of CEXs

Solend liquidity mining rewards have been turned off until further notice

Umee is launching a new chain, the Ojo Network - will focus on providing oracle services to the cosmos interchain

🖼 NFT/Gaming/Metaverse News:

Yuga Labs acquired Beeple’s NFT platform Wenew and its flagship NFT collection, 10KTF with Beeple joining Yuga Labs as an advisor

Nike is taking further steps towards Web3 integration with its release of .SWOOSH, a new platform geared towards building community around its digital wearables
The Tie has launched a brand new, comprehensive dashboard for Avalanche GameFi and NFTs

GAM3 AWARDS | Annual Web3 Gaming Awards | Polkastarter Gaming - December 15th

💰 Fundraises:

Buildspace raises $10M led by a16z to build Hogwarts for builders and dreamers

FTX and Avalanche co-led $5M round for Joepegs NFT marketplace

👶 Early Stage Projects:

Red Alarm - The following projects and dApps have been assessed to be untrustworthy and carry extremely high levels of risks

Binance Labs has selected 12 projects for season 5 of its accelerator program

What’s your take on today’s news? Anything interesting that you have to say about these stories? Did we miss anything that should’ve been included?

📊 Data:

TL;DR: Biggest takeaway from the last week is that people rushed to remove their crypto off of exchanges - primarily stablecoins and ETH.

Nansen Exchange Flows:

- Inflow (7D): LUNC was sent onto exchanges - presumably to sell

- Outflow (7D): Removal of USDC, USDT, ETH, BUSD off exchanges

ETH & Stablecoin Exchange Flows:

The ETH and stablecoins held on exchanges recently plummeted and this is most likely due to fear and uncertainty related to the solvency of CEXs. When in doubt, seems people prefer to custody their own crypto and keep it off exchanges

What is the Data telling you? See anything that sticks out to you?

🎓 Research/Reads:

Glassnode - The Fall of FTX - source

WuBlockchain - Clarify Merkle Tree: see how centralized exchanges "certify their innocence" - source

Animoca Brands - Glimpsing the future through the lens of days past: Part 2 - source

Sophistry and the Savior - source

Have you seen our institutional-quality research?

M6 Research

🌍 Crypto Twitterverse:

Cumberland @CumberlandSays

Last week was Cumberland’s most active week ever. Beneath the chaos and explosive volumes, the FTX bankruptcy has triggered some important market structure changes 🧵👇

Balaji @balajis

Pagerank is one way to quantify reputation. How do we quantify trust?

Jordi Alexander @gametheorizing

Migration towards Defi Exchanges- Like WFH, it was always going to happen, but this is the Covid accelerant moment. At Selini Capital we have many HFT veterans amongst us, with an intricate understanding of market microstructure. Lessons that are guiding us on evaluating DEXes:

ogle @cryptogle

.@TokensoftInc just doxed the KYC of about 5k users - full names, wallet addresses, and IRL addresses - because they believe they are "bad actors" gaming airdrops. Even if they are gaming airdrops, you should never dox your users. wtf is wrong with these guys? cc @tier10k

Edward Snowden @Snowden

There's still a lot of trouble ahead, but for the first time in a while I'm starting to feel the itch to scale back in.

Cobie @cobie

@219_eth Bearish thesis: the 2nd biggest crypto exchange turned out to be one of the biggest frauds of recent decades Bullish thesis: they can't steal our coins and sell them anymore?

Cyrus Younessi @cyounessi1

🧵Mini thread on contagion risk: The most important argument playing out on CT right now is about the extent of the contagion risk. We have all noticed that the market has weirdly not sold off too hard yet.

Did we miss anything or is there anything you want to discuss? We’d Love to hear your feedback and engage with the community! Feel free to leave a comment and let us know your thoughts on the Crypto market!