In case any of your friends either were unaware of, or jaded to, the vast political corruption tied to titanic crypto exchange FTX’s collapse, new court filings now offer an infuriating wake-up call.
Business Insider’s Pete Syme reports that in the FTX bankruptcy case working through U.S. Bankruptcy Court in Wilmington, Delaware, the legal team for the now-defunct-formerly-adored-by-leftists corporation recently revealed that company kingpin Sam Bankman-Fried used a digital backdoor to steer investor money into real estate, planes, parties, and -- perhaps most dangerous to those who never invested with FTX – political donations.
Syme notes that the money-pipe ran to Bankman-Fried’s then-girlfriend’s FTX offshoot corporation, Alameda, and from there, Caroline Ellison’s team could shower financial influence on politics.
“Sam Bankman-Fried instructed his FTX cofounder Gary Wang to create a ‘secret’ backdoor to enable his trading firm Alameda to borrow $65 billion of clients' money from the exchange without their permission, the Delaware bankruptcy court was told Wednesday.”
But this “borrowing” wasn’t disclosed. And, as economics students learn is usually the case with government-connected central banks, FTX’s secret spending “euphemistically called “investment”) was not backed up with sufficient reserves to cover any calls that investors might make should they want their money.
Governments and central banks continue to operate that way, because they fraudulently claim the power to write statutes that perpetuate their corrupt activities, but, for businesses, this shady, fractional-reserve modus operandi is a recipe for financial demise.
Related: No Surprise: Sen. Warren Suddenly Dreams Up a Bill To Crush Cryptocurrency | MRCTV
“Wang was told to create a ‘backdoor, a secret way for Alameda to borrow from customers on the exchange without permission,’ said FTX lawyer Andrew Dietderich.”
And he adds:
"’Mr. Wang created this back door by inserting a single number into millions of lines of code for the exchange, creating a line of credit from FTX to Alameda, to which customers did not consent,’ he added. ‘And we know the size of that line of credit. It was $65 billion.’"
Which facilitated purchases of property, funding of parties, and funding of political parties that placed Bankman-Fried in the Number Two slot of big donors to Democrats in recent US campaign cycle.
And, lest we forget, millions in FTX cash magically came from…the government of Ukraine. As I reported for MRCTV on December 19, last year:
“…a large portion of Bankman-Fried’s unbalanced FTX ledger was funded via the U.S.-subsidized government of Ukraine, and that facilitated Sammy’s $40 million in campaign contributions to Democrats, making him the second-biggest donor to the Dems in the 2021-2022 cycle behind the all-enlightened George Soros, and ahead of Michael “Ban The Guns” Bloomberg, and it does seem odd that, once the election was over, FTX suddenly got exposed for all this alleged fraud.”
And it also seems odd that close Bankman-Fried allies and White House advisors were running a secret, back-channel communications line – until the FTX corruption was exposed.
In a December 27 follow-up for MRCTV, I reported that the cozy pals operating this communications line on Slack shut down the portal on Nov. 12, the day after FTX filed for bankruptcy and SBF resigned as CEO.
But why should we worry? After all, the “for the people” corporate lawyer turned Senator Liz Warren (D-MA) suddenly produced legislation to have the unsullied and completely peaceful federal government engage in more constitutionally dubious activity by smothering the freedom of people who want to buy and sell crypto or use crypto as a means of exchange. She somehow was so prescient, she had the “Digital Asset Anti-Money Laundering Act of 2022” ready, mere days after the FTX collapse.
And, while it doesn’t say anything about stopping secret back-channel communications lines between White House officials and special interests, it does slam the innocent individuals who might want to acquire Bitcoin or other cryptocurrencies, invading their privacy, labeling them “Money Service Businesses”, and telling those folks, who often get crypto in order to exchange with privacy, that they must report to the feds.
As I noted in December, her bill states:
“Not later than 120 days after the date of enactment of this Act, the Financial Crimes Enforcement Network (FINCEN) shall promulgate a rule that requires United States persons engaged in a transaction with a value greater than $10,000 in digital assets through 1 or more accounts outside of the United States to file a report described in section 1010.350 of 20 title 31, Code of Federal Regulations…”
Warren doesn’t mention the fact that her mandates are based on inappropriate expansions of the Interstate Commerce clause of the Constitution, but she certainly knows how to use an “unexpected crisis” to increase the size of government and tilt power towards politicians and bureaucrats, regardless of the founding document. Specifically, she wants to strongarm Americans away from real, value-retaining, cryptocurrency and towards government-created, inflationary, privacy-invading Central Bank Digital Currency (CBDC).
Given the cozy relationship politics has had with FTX, wouldn’t it be a better idea to get government away from our choices of currency altogether?
Related: Ties And Timing: Bankman-Fried, Biden Officials, & Activists Had Secret Chat Channel | MRCTV
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