One of Alameda’s wallets, holding $1.8m LDO, approved the LDO contract funds in December, ever since filing for Chapter 11 Bankruptcy, FTX and Alameda Research have been skipping on adjusting its balance sheets.
Just recently, the FTX bankruptcy estate is paying liquidators $1300 an hour to spend $2.99 on gas to move $0.02 worth of sushi tokens into multisig wallets.
It can be funny, but the point is they’re balancing their books to prepare for liquidation in the court system. So that’s where the real cost per hour comes into play. Obviously FTX failed to do so themselves so had to bring in the big boys for the job.
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Maybe the FTX liquidators should have hired someone who knows how to DeFi. In the past few days they’ve:
– burned renBTC to the defunct bridge
– traded millions of tokens with the metamask wallet swap feature
– tried to sell vesting tokens
First time? All of these transactions are in the process of moving funds to a multisig, this explains why they are now consolidating on remaining wallets as some of Alameda wallets are obviously compromised.
The most innocent explanation here is that they are consolidating funds into the FTX Estate Multisig but as part of it are vested tokens, transfer failed, they did not understand why they could not move it and then tried to approve the contract to trade hoping this was the issue.
Sam Bankman- Fried at least had this right: bankruptcy professionals will make big bucks in this case. Just keep your eyes open for the fee as they hit the docket. Going to milk that bankruptcy as much as possible so the claimants get a check for $1.32 each, It’s by design.
Just like needing $450m for legal fees asked by the attorney himself on behalf of SBF. Like in the end after all fees there will be nothing left to repay, as long as the process is served and the people in the process get paid. It’s never about the bag holders is it ?.
FTX and Alameda Research failed at their fiduciary duties. Conor Grogan, Director at Coinbase said;
Interacting with spam tokens is not what I would call responsible, and could lead to the loss of all funds. I imagine the billable rates of lawyers for that will be a lot more than drafting a note on why they couldn’t recover “all” assets in each wallet, this isn’t a hypothetical – we’ve already seen clear behavior that points to wallets being compromised, and one of the vectors could have been malicious token approvals.
Alameda’s wallet was swapping bits of ERC-20s for Ether and then the ETH and USDT were funneled through instant exchangers and mixers, such as FixedFloat and ChangeNow, which are often used by hackers and exploiters to hide transaction routes.
The cleanup crew is here, once they spend the leftover liquid assets tied to FTX and Alameda Research they will blame the inefficiencies of the crypto system which resulted in the loss of funds.