FTX, the defunct cryptocurrency exchange, is finally being forced to publicly detail its spending habits in the company’s ongoing Chapter 11 bankruptcy proceedings. And the resulting documents are illuminating.
The crypto exchange, founded and formerly owned by fallen blockchain golden boy, Sam Bankman-Fried, spent hundreds of thousands of dollars on extraneous food and fun purchases over the course of just a couple of months — presumably for employees.
Previously unsealed court filings have shown that the debtors owed by FTX and its associated companies included Doordash, Netflix, and Airbnb — but additional documents released this week and viewed by Gizmodo illustrate exactly how much was being spent on some of these staff perks, as first reported by Insider.
West Realm Shires Services Inc., the operating entity of FTX, paid $US357,526.39 ($496,318) to food delivery company, DoorDash, over just two months, according to a Wednesday filing in Delaware Chancery Court (Docket 1010). In September 2022, the trading company, which did business as FTX US, paid $US183,824.12 ($255,185) to Doordash. In October 2022, West Realm spent an additional $US173,702.27 ($241,133) on the food courier service, per the document.
Another separate filing (Docket 1001) shows that West Realm has tens of thousands in unpaid debt to DoorDash. The FTX-affiliate allegedly owes $US25,347.95 ($35,188) to the food delivery service in the U.S., and an additional $US521.87 ($724) to DoorDash Technologies Canada, Inc..
Alameda Research LLC, Bankman-Fried’s hedge fund which was closely linked to FTX and played a direct role in the exchange’s collapse, also racked up some serious DoorDash bills. Alameda paid a total of $US46,239.11 ($64,189) to DoorDash between September 2022 and October 2022, according to Docket 1025. The hedge fund has alleged outstanding food delivery debts of $US28,658.83 ($39,784), per Docket 1022.
In addition to the food delivery charges, Alameda has some other questionable, allegedly outstanding debts listed in the Wednesday documents. The Margaritaville Beach Resort in Nassau Bahamas has filed a claim stating that the hedge fund company owes $US599,409.72 ($832,101) (Docket 1022). The only larger expense listed in the same filing is more than $US6 ($8) million owed to Amazon Web Services — which seems justifiable for a modern-day hedge fund. Over half a million to Margaritaville, on the other hand, feels less above board.
West Realm Shire Services paid $US70,066.57 ($97,266) to Caesars Entertainment, the Las Vegas-based hotel and casino company, in October. Similarly large payments were sent to Monumental Sports & Entertainment and WME Entertainment — both large event companies.
FTX Trading Ltd., the official name for the overall FTX exchange entity, shelled out nearly $US100,000 ($138,820) on Grand Prix tickets alone, per Docket 977.
The bankruptcy filings offer further support to allegations and reports that Bankman-Fried and his companies were spending irresponsibly and managing their financial ledgers with a freewheeling lack of attention. FTX US employees were allowed up to $US200 ($278) of Doordash delivery spending per day, according to the Financial Times. That same FT report noted purchases of homes and vacation properties used by FTX senior executives, as well as restaurant purchases — not buying food from restaurants, but execs literally buying up restaurants.
FTX entities paid out more than $US3 ($4) billion to its top executives, including Bankman-Fried, in the lead up to the company collapse. Then, there’s the incredible amount of both public and private “dark money” political expenditures that Bankman-Fried and his associates allegedly funneled to various campaigns.
Unfortunately for FTX customers, the shuttered exchange, its affiliates, and its former leadership will likely have to compensate the companies they owe debts to long before U.S.-based customers of the exchange see any of their investment funds returned. Though FTX Japan has resumed customer withdrawals thanks to strict financial regulation in the country, no other subsidiary of the exchange or linked FTX exchange has.