Where did FTX's $9 billion go?

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Here are the key points summarizing the search results on where FTX's $9 billion in missing customer funds went:
  • Forensic accounting analysis by expert Peter Easton found that $9 billion in FTX customer funds were missing as of June 2022, 5 months before FTX filed for bankruptcy. The funds were deposited by customers into FTX but ended up in Alameda Research's accounts.
  • The missing funds were used for various purposes by Alameda Research, including investments in companies like SkyBridge Capital and Modulo Capital, repaying lenders like Celsius and Maple, political donations through groups like Mind the Gap, and real estate purchases including property owned by SBF's parents.
  • FTX and Alameda Research were highly commingled, with Alameda routinely borrowing customer funds from FTX with few limits or oversight. Alameda had access to as much as $8-13 billion in FTX customer funds.
  • The lack of financial controls and oversight at FTX enabled the misuse of customer funds. FTX lacked proper record keeping, controls on fund transfers, and audits.
  • SBF and other executives were aware of Alameda's large debts to FTX but did little to restrict Alameda's access to customer funds or correct the financial issues.
  • The missing funds contributed to FTX's liquidity crisis when customers attempted to withdraw funds in November 2022. This ultimately led to FTX filing for bankruptcy on November 11, 2022.
In summary, the $9 billion in missing FTX customer funds were used to finance Alameda Research's operations, investments, real estate purchases, and political donations, enabled by lack of controls at FTX and commingling of assets between the two entities. The misuse of funds was known by executives but not corrected, ultimately leading to insolvency and FTX's collapse.
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