Key Takeaways
The Block CEO Michael McCaffrey was revealed right now to have secretly borrowed $43 million from Sam Bankman-Fried.
At least $27 million had been used to fund the crypto information firm.
McCaffrey has resigned.
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Sam Bankman-Fried supplied The Block not less than $27 million in funding within the final yr and a half. It seems that nobody on the firm was conscious of the deal aside from CEO Michael McCaffrey.
SBF Funded The Block
The FTX saga retains taking sudden turns.
According to a report from Axios, crypto information firm The Block benefited from three multi-million greenback loans from former FTX CEO Sam Bankman-Fried during the last yr and a half. The loans had been straight made to The Block CEO Michael McCaffrey, who seems to haven’t disclosed them to another firm members.
The report signifies McCaffrey obtained a primary mortgage of $12 million in April 2021, a second of $15 million in January 2022, and a 3rd of $16 million someday in spring of 2022. The first two loans had been reportedly used to restructure the corporate and shore up its steadiness sheet. At least a part of the third mortgage was allegedly funneled for McCaffey to purchase property within the Bahamas. McCaffrey himself said that the primary two loans used to “strengthen the business’ position” in a Twitter thread. He didn’t verify the existence of a 3rd mortgage.
McCaffrey introduced his resignation as the corporate’s CEO and sole board member shortly after the publication of the Axios report; he was changed by former chief income officer Bobby Moran. “No one at The Block had any knowledge of this financial arrangement besides Mike,” claimed Moran in a public assertion. Moran indicated that McCaffrey solely disclosed the loans to him simply earlier than November 24. Other firm members had been made conscious of the scenario this afternoon throughout an all-hands assembly.
“Had I known about this, I would have not only called it out and disputed [McCaffrey’s] actions, but called for an immediate change in leadership. Putting aside the FTX meltdown, there is no excuse for his deception and disregard for the 160 people who work at The Block,” mentioned The Block editor-at-large Frank Chaparro. Other members of the corporate voiced comparable emotions.
The phrases of the offers between McCaffrey and Bankman-Fried are nonetheless unclear. “We have seen no evidence that Mike ever sought to improperly influence the newsroom or research teams, particularly in their coverage of SBF, FTX, and Alameda Research,” mentioned Moran in his assertion.
The Block lately printed a two-hour lengthy interview between Chaparro and Bankman-Fried. Chaparro was effectively praised by the crypto neighborhood for his stern, unyielding perspective in the direction of the disgraced trade founder.
Disclaimer: At the time of writing, the creator of this piece owned BTC, ETH, and several other different crypto property.
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