The 2021 sale of FTX equity owned by Binance in exchange for FTX Token (FTT) and BUSD was purchased by Alameda Research, according to documents distributed as part of the Series B-1 that Protos reviewed. This confirms the reporting about FTX equity being on Alameda Research’s balance sheet as provided by Sam Bankman-Fried to Forbes.
The documents detail that the sale was completed at a price of $23.66 per share, valuing FTX at approximately $16.1 billion. This was less than the Series B transaction which gave FTX a valuation of $17.9 billion.
This purchase of FTX equity by Alameda Research using FTT issued by FTX emphasizes how deeply intertwined the finances of these corporations were underneath Sam Bankman-Fried.
The documents also suggest that FTX was expecting to have a net operating income (NOI) of approximately $415 million with a 55% margin for 2022 Q4. This was projected based on approximately $750 million in revenue, driven almost entirely by a projected $500 million in derivatives trading fees. For the entirety of 2022, it expected to have a total of $1.27 billion in NOI with margins of 53%.
FTX projected that by the end of 2024, its NOI would have increased to approximately $1.4 billion with margins improving to 67%. The total NOI for 2024 was estimated to be approximately $5 billion, with margins of 66%.
FTX’s unaudited balance sheet that was distributed along with the other documents show only a single bank account listed at PrimeTrust containing less than $1.5 million.
Much of the remaining assets are in “digital assets and stablecoins” where it has approximately $225 million. There’s an important note on this section that says: “Mostly held in USDC. The exchange doesn’t take any principal risk.”
Principal risk would be the risk that the exchange would be exposed to if the value of digital assets changed.
Currently, FTX is bankrupt and insolvent, with billions of dollars in customer funds unaccounted for.