Amid persevering with fallout from the implosion of FTX final November, Alameda Research has filed a lawsuit in opposition to K5 Global and a co-founder. The goal of the swimsuit? To regain $700 million that former FTX head Sam Bankman-Fried donated, when looking for to construct relationships in the times earlier than FTX fell aside.
Plaintiffs say Bankman-Fried approved a switch of $700 million hoping to consolidate his ties with Michael Kives, a former Hillary Clinton aide. And with Kives’s asset supervisor, K5 Global. However, in an electronic mail trade with BeInCrypto, a K5 consultant described the funding as aboveboard.
Are Alameda Research’s Claims Wrong?
According to the lawsuit, Sam Bankman-Fried wished to be on Kives’s good facet. Tellingly, the FTX founder known as Kives “the most connected person I’ve ever met,” as reported in a Reuters story.
The assaults on Bankman-Fried have sought to painting him as a gregarious crypto entrepreneur. Hence as one who wished to make quick mates by throwing cash round. In the view of the plaintiffs, the recipients of the $700 million have been extra his mates than enterprise associates.
But Elizabeth Ashford, a K5 Global spokesperson, rebutted the claims in an announcement despatched to BeInCrypto, Reuters, and different information organizations.
“Our belief is that the lawsuit is without merit,” Ashford wrote in the e-mail to BeInCrypto.
Moreover, in her electronic mail, Ashford described K5 as a longtime asset supervisor. And as one which had each proper to do professional enterprise with Bankman-Fried throughout the interval in query. Ashford wrote:
“K5 is a venture capital firm with over $1 billion in assets under management (apart from any funds from SBF and his affiliates and has investments in 148 companies.”
In the center of 2022, Ashford defined, an affiliate of SBF and Alameda made a deal to buy a 3rd of K5’s normal partnership. The deal concerned each money and inventory. And the affiliate ended up making a $500 million funding in K5-managed funds.
From K5’s standpoint, there was no purpose on the time to view the funding as apart from authorized and acceptable.
For its half, K5’s LinkedIn web page describes it as a agency with “2-10” staff.
FTX Complications
The insolvency of FTX is a nettlesome and protracted authorized course of. This is way from the primary authorized motion that Alameda has taken. Its efforts to mitigate the catastrophe of FTX’s failure are many and assorted.
In March, Alameda sued Grayscale Investments over the valuation of FTX debtors’ shares in its Ethereum and Bitcoin trusts.
By stopping debtors from making redemptions, the swimsuit claimed, Grayscale diluted the worth of the shares by 90%.
John Ray III took over as CEO of FTX Trading with the goal of guiding the trade by way of its restructuring. Ray charged on the time that Grayscale’s “self-dealing” had diminished the worth of FTX debtors’ shares.
Disclaimer
In adherence to the Trust Project tips, BeInCrypto is dedicated to unbiased, clear reporting. This information article goals to supply correct, well timed data. However, readers are suggested to confirm details independently and seek the advice of with knowledgeable earlier than making any choices primarily based on this content material.
