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FTX: Stanford University Pledge to Return Donation Amidst Legal Turmoil

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The now-bankrupt crypto exchange FTX made substantial donations to one of America’s most prestigious institutions, Stanford University, during the tenure of its founder, Sam Bankman-Fried. However, as FTX’s fortunes took a dramatic nosedive in November, the group of debtors associated with the platform embarked on an ardent quest to reclaim these sizable contributions. Stanford, on the other hand, has taken a commendable step by initiating discussions with legal experts to facilitate the return of these donations to their rightful owners.

A spokesperson for the venerable university reaffirmed their unwavering commitment to restoring the entire sum to its original benefactors. It is crucial to underscore that in recent developments, the crypto exchange, now under new management, recently filed a lawsuit against Joseph Bankman and Barbara Fried, the parents of Sam Bankman-Fried, accusing them of misappropriating funds.

The lawsuit’s core allegation revolves around the period spanning from November 2021 to May 2022 when Sam Bankman-Fried allegedly orchestrated the channeling of over $5.5 million in donations from the FTX Group to his employer, Stanford University. Prior to this legal tussle, representatives from Stanford had acknowledged receiving donations from the FTX Foundation and affiliated entities, primarily designated for pandemic-related research and prevention efforts.

The latest allegations of financial impropriety have cast a shadow of doubt over the initial intent behind these ostensibly benevolent contributions. Court documents shed further light on the predicament of Joseph Bankman and Barbara Fried, both esteemed professors at Stanford Law School, now facing scrutiny for potentially leveraging their positions to exploit their connections within FTX, amassing substantial wealth in the process.

Celebrities Settle FTX Lawsuits

In response to these grave accusations, the legal representatives of Joseph Bankman and Barbara Fried vehemently denied any wrongdoing, categorizing the claims as “completely false.” They characterized the lawsuit as a “dangerous attempt to intimidate” the accused and undermine the legal process, a move they allege was strategically timed just days before their child’s trial.

Adding another layer of complexity to the FTX narrative, recent developments saw a trio of celebrities settling lawsuits related to sponsorship deals they had struck with the now-defunct crypto exchange before its precipitous collapse in the previous year. NFL quarterback Trevor Lawrence, representing the Jacksonville Jaguars, reportedly reached an undisclosed settlement to resolve accusations of misleading investors in FTX. Additionally, prominent YouTubers Tom Nash and Kevin Paffrath also entered into settlements, although the specific terms remained undisclosed.

Crypto for a Cause: Oprah and The Rock’s Maui Wildfire Donation Drive Gains Momentum

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Dwayne “The Rock” Johnson and Oprah Winfrey have jointly initiated the People’s Fund of Maui, aimed at offering direct financial aid to individuals affected by the recent disaster. The crypto community has joined forces to support the Maui community through this relief fund, which is championed by renowned celebrities Oprah Winfrey and Dwayne “The Rock” Johnson and accepts cryptocurrency donations.

In the early days of August 2023, wildfires wreaked havoc on the Hawaiian island of Maui, resulting in significant property and personal losses as more than 2,500 acres went up in flames. Responding to the crisis, The Rock and Oprah established the People’s Fund of Maui, dedicated to providing direct financial assistance to those impacted by this tragedy. In a tweet, The Rock assured that every adult resident in the affected areas of Lahaina and Kula, who were displaced by the wildfires, would be eligible to receive $1,200 per month to assist them during the recovery phase.

The People’s Fund of Maui welcomes donations in various forms, including traditional fiat currencies and cryptocurrencies. In addition to accepting fiat donations from across the globe, the fund is open to contributions in cryptocurrencies like Bitcoin (BTC), currently trading at $26,029, Ethereum (ETH), which is priced at $1,645, and Dogecoin (DOGE), with a value of $0.06, among numerous other alternative digital currencies.

Celebrities and Crypto

As Oprah articulated, the primary aim of delivering donations directly to the survivors is to empower them to make decisions regarding their path toward recovery. She emphasized, “Enabling individuals to exercise their own agency and make choices for themselves, addressing their specific needs and those of their families—that is our objective.” In tandem with the influential efforts of A-list celebrities, various relief initiatives are dedicated to aiding the victims of the wildfire. Among these, the disaster relief organization All Hands and Hearts has been actively gathering both cryptocurrency and traditional currency donations to support the local residents of Maui in the aftermath of the fires.

Olga Ruggiero, the Chief of Organizational Integration and Events at All Hands and Hearts, noted, “Cryptocurrency contributions, like any other form of donations, play a crucial role in providing vital assistance following the devastating wildfires.” She further emphasized that the cryptocurrency industry continues to unite with communities in need worldwide.

Ukraine’s Struggle: $225M In Crypto Donations Received To Combat Russian Aggression

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In the face of Russia’s relentless invasion, Ukraine has been fighting a valiant battle on multiple fronts, and the global community has rallied behind them in support. A recent report by blockchain intelligence firm Crystal Blockchain has shed light on the astounding financial backing that Ukraine has received in the form of crypto assets.

Crypto Donations Soar: Ukraine Rakes In Billions

Since the­ beginning of Russia’s full-scale invasion last year, Ukraine­ has garnered a substantial $225 million in cryptocurrency donations alone­. These funds have playe­d a pivotal role in acquiring essential supplie­s, encompassing weapons, ammunition, and medical e­quipment. Consequently, Ukraine­ has successfully stood its ground against the aggressor.

The global crypto community has consiste­ntly demonstrated immense­ generosity, as evide­nced by the unwavering nature­ of their donations. Month after month, these­ contributions have surged with remarkable­ solidarity. However, since re­aching its apex in March 2022, when global unity was at its strongest, monthly crypto donations have­ gradually tapered off and failed to e­xceed $10 million since May of that same­ year.

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Ukraine's Struggle: $225M In Crypto Donations Received To Combat Russian Aggression 3

Interestingly, humanitarian initiatives have garnered more crypto donations than military-focused campaigns. Out of the $225 million raised in digital assets, $134 million was allocated to address the urgent humanitarian needs of the affected population, while $91 million was channeled toward strengthening the country’s armed forces.

Breaking down the digital asset contributions, the majority came in USDT, totaling an impressive $83 million. Ethereum was the second most popular choice, with donations worth $79 million, followed by Bitcoin, which contributed $41 million. Smaller cryptocurrencies like Binance USD (BUSD) and Polkadot’s DOT made up the remaining contributions.

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Ukraine's Struggle: $225M In Crypto Donations Received To Combat Russian Aggression 4

On the flip side, Russia’s military and paramilitary units have also embraced digital asset fundraising efforts. However, their endeavors have remained covert and under the radar. Crystal’s data reveals that crypto donations to the Russian military barely amounted to $2 million. 

Nevertheless, some estimates suggest higher figures, with Chainalysis reporting $5.4 million of donations in February, directed both to Russian military units and propaganda resources.

The stark contrast between the sums raised for Ukraine’s defense and Russia’s war efforts can be attributed to the global condemnation of Russia’s actions and the clandestine nature of its fundraising activities. Binance, for instance, identified over $7.2 million worth of donations to Russia, hinting at the potential scale of covert support.

As the conflict rages on, it is evident that the power of digital assets extends beyond financial transactions. The solidarity shown by crypto users worldwide in supporting Ukraine’s resilience against aggression highlights the humanitarian spirit that transcends borders, uniting people in times of crisis.

Related Reading | Crypto Fund Shrinks: Sequoia Capital’s 66% Slash 

FTX Empowers the Metropolitan Museum of Art with $550K Donation

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The Metropolitan Museum of Art, located in New York, has announced that it will give back $550,000 in donations it received from the cryptocurrency exchange FTX before they faced financial difficulties and filed for bankruptcy in November. The museum confirmed this decision in a filing submitted to the United States Bankruptcy Court in Delaware on June 2, which is the same court where this cryptocurrency exchange initiated its bankruptcy proceedings. The museum aims to return the funds to FTX debtors.

FTX
FTX Empowers the Metropolitan Museum of Art with $550K Donation 7

The Metropolitan Museum of Art stated that the decision to return the funds resulted from fair and transparent discussions with FTX’s debtors, demonstrating good faith. The museum received the total amount of $550,000 in two distinct payments. The initial installment of $300,000 was received in March 2022, followed by an additional $250,000 two months later, in May.

The donations were arranged through West Realm Shires Services, the company responsible for operating FTX.US. FTX’s leadership has been actively trying to recover the donations it made to politicians and various organizations since December, shortly after filing for bankruptcy in Delaware. According to court documents, FTX distributed a total of $93 million in donations between March 2020 and November 2022.

According to data from Unusual Whales, out of the approximately 180 US politicians who received funds from FTX, only 19 of them have either returned the funds or indicated their intention to do so. Data from Market Watch reveals that the “Protect our Future PAC” was the primary beneficiary of FTX’s donations, receiving approximately $27 million from the cryptocurrency exchange.

FTX Lawsuits Reverberate

Several crypto influencers have become more cautious about accepting lucrative endorsement offers due to the potential consequences if things go wrong for the company involved. This shift in approach follows the collapse of the crypto exchange FTX last year, which led to several celebrities being sued for their alleged role in promoting it.

In March, a class-action lawsuit worth $1 billion was filed, accusing eight influencers of promoting “FTX crypto fraud” without disclosing their compensation.

According to influencers interviewed by Cointelegraph, this situation has served as a wake-up call. Those who endorse crypto companies now recognize that their followers may take legal action against them in the future if the endorsed company turns out to be unfavorable.

For example, crypto vlogger Tiffany Fong, who gained recognition for her interview with former FTX CEO Sam Bankman-Fried after the collapse, currently has no interest in endorsing crypto firms on her social media platforms.

FTX
FTX Empowers the Metropolitan Museum of Art with $550K Donation 8

Marketing agencies that facilitate collaborations between influencers and brands have observed concerns from both parties involved in the business.

Nikita Sachdev, the CEO and founder of Luna PR, emphasized that it’s not just influencers who are displaying increased caution regarding endorsement deals, but crypto companies themselves are also adopting a more careful approach.

Sachdev highlighted that the prolonged downturn in the crypto market has compelled crypto companies to adopt stricter budgetary measures, leading to an overall decrease in influencer partnerships. Rasmus Rasmussen, the Chief Marketing Officer of Polygon NFT game Planet IX, expressed to Cointelegraph that it has become increasingly difficult to engage A-list influencers for promoting cryptocurrencies following the FTX collapse.

Bitcoin Bet Results In $1 Million Donations By Former Coinbase CTO

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Former Coinbase CTO Balaji Srinivasan recently closed a wager that he made with a Twitter user over whether Bitcoin would reach $1 million within 90 days. 

The announcement was made on Twitter, where he stated that the bet he made with someone about the state of the economy was closed out by mutual agreement. He also stated that he had made $1 million in on-chain donations to various organizations, including Bitcoin Core development via Chaincode, Give Directly, and Medlock.

Srinivasan explained in a series of tweets that his actions were not those of a trader or someone looking to make a quick buck. Instead, he wanted to send a message to the public about the state of the economy, which he believes is not as strong as some may think.

Srinivasan expressed concerns about public sector officials’ lack of warning signs regarding previous financial crises, citing the 2008 financial crisis as an example. He argued that it is up to individuals to send signals that something is wrong with the economy, and that this was his way of doing so.

He also posed a question to his followers about the likelihood of the US defaulting on its debt in the near future. He estimated a 10% chance in months, a 70% chance in years, a 19% chance in decades, and a 1% chance in centuries. He asked for others’ opinions and included explicit and implicit default in their estimates.

Bitcoin Price Analysis

Bitcoin (BTC) is currently showing positive signs, as per the latest data from CoinMarketcap. The leading cryptocurrency is trading at $28,345.52, up by about 1.20% in the last 24 hours. However, BTC has also recorded a decline of about 4.85% in the weekly chart, indicating some volatility in the market.

In addition, BTC’s trading volume has witnessed an increase of 4.85%, reaching $17,230,297,972, whereas the market capitalization has gone up by 0.93%. These figures suggest that despite the fluctuations, Bitcoin is still holding strong.

BTC 1D graph coinmarketcap 16
Source: CoinMarketcap

Moreover, a recent tweet by one of Glassnode’s co-founders, specializing in cryptocurrency analysis, has sparked interest among investors. The co-founder shared some intriguing insights about the future trajectory of BTC. 

He emphasized that the $28,000 price point is a crucial battleground for investors and confidently asserted that those who are bearish on Bitcoin are “expensively wrong.” This statement suggests that the market sentiment might lean towards a bullish scenario.

Related Reading | Coinbase Goes Global: Launches International Exchange & Expands Crypto Futures Offerings

Ethereum’s Buterin Leads Relief Efforts with Multiple ETH Donations For Turkey & Syria

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The Ethereum community has come forward to support relief efforts, with Ethereum co-founder Vitalik Buterin leading the charge with his generous donations for Turkey and Syria.

A 7.8 magnitude earthquake struck Turkey and Syria on February 6th, leaving behind a death toll that has now risen to 33,000, making it one of the world’s worst earthquakes in decades. 

Ethereum Community Pledges Millions in Crypto Donations

According to blockchain security firm PeckShield, Vitalik has been actively donating Ethereum to support the relief efforts, with his latest donation of 50 ETH, equivalent to approximately $77,000, sent to Anka Relief on February 12th. 

Anka thanked the Ethereum co-founder for his generosity and stated that crypto donations had been steadily flowing since the first day of the disaster. In total, Vitalik has donated 99 ETH worth around $150,000 to Ahbap, a non-governmental and non-profit organization dedicated to providing relief to those affected by the earthquake.

The crypto industry has been quick to respond, with blockchain records showing that wallet addresses shared by Ahbap have received over $3 million in crypto donations. 

According to Chainalysis, a blockchain analytics firm, more than $5 million in crypto donations have been sent to Turkey and Syria. Binance, a major crypto company, has pledged $5 million, while other firms have pledged over $10 million in total, FT reported.

It’s not the first time that crypto has been used for disaster relief efforts. After the massive earthquake in Nepal in 2015, Bitcoin donations were sent to various relief organizations. The use of crypto for disaster relief has become increasingly popular as it offers a fast and secure way to donate money to those in need.

Turkey’s economic struggles, even before the earthquake, make it a prime candidate for embracing crypto. With soaring prices and declining interest rates, crypto assets such as Ethereum are seen as a store of wealth and a hedge against inflation. The crypto industry has demonstrated its willingness to help those in need and has shown that it can make a real impact in times of crisis.

Related Reading | Weekly Market Watch: Bitcoin & Ethereum’s Bulls Slowdowns, Low Cap Tokens Experience Growth

FTX Seeks Return Of Donation Funds By Feb 28

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Now defunct crypto exchange FTX has sent out confidential messages to political figures and other recipients of contributions requesting to return such funds to the FTX Debtors by February 28, 2023.

The bankrupt firm also issued a press release warning against defaulters, stating that the FTX Debtors might take legal action to recover the returned payments, with interest starting on the day any action is started.

The latest development comes after FTX Debtors’ December 19, 2022 announcement of establishing arrangements for such recipients to return funds voluntarily by contacting [FTXrepay@ftx.us].

In addition to that, all such recipients even those who made payment or donation to a third party [including a charity] in the amount of any payment received from an FTX Contributor are too not exempted, the blog added.

The SBF-led exchange once valued at $32 billion, had to file for bankruptcy last year after the price of its exchange token FTT collapsed which triggered sparked a run on the platform.

It was later revealed that it did not have enough reserves of customer assets as it failed to honor withdrawals.

Founder Bankman-Fried was arrested and charged with eight counts of financial crimes, including securities fraud, money laundering, and campaign finance violations by federal prosecutors in the Southern District of New York. 

Bankman-Fried is accused of misusing billions of dollars in client cash to fund activity at his trading firm Alameda Research, buy private real estate, and contribute to political campaigns. He has pled not guilty to the accusations, and his trial is scheduled for October.

FTX Ex-CEO Donated Roughly $40M In The 2022 Election Cycle

Creditors and lawmakers have tried to make sense of the crypto behemoth’s collapse. Since then, there has been pressure mounting on several members of the US Congress who received donations from the former CEO of FTX, or people connected to him.

According to sources, only five respondents had reportedly returned the money they received as of January 18, while a majority of 53 campaigns said they had again sent the money to non-profits.

Further, CBS News reported that the former billionaire donated close to $40 million during the 2022 election cycle. His recipients mostly comprised of Democratic candidates but have also admitted to making “dark” donations to Republican candidates as well.

The legal proceedings against Bankman-Fried are ongoing.

Wikimedia Foundation Scraps Crypto Donations After 71% Voted In Favor

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The Wikimedia Foundation [WMF], the creator behind Wikipedia, has finally closed down its BitPay account and will stop accepting cryptocurrency donations after 232 members, or 71% of the WMF community voted in favor of a three-month-old proposal that rallied to put an end, citing environmental risk and for its “inherently predatory” investments.

The foundation which started accepting Bitcoin, Bitcoin Cash, and Ether donations in 2014, also began to reconsider this policy. Some of the issues raised were the environmental impact of Bitcoin, various crypto scams, as well as the low amount of donations in cryptocurrency compared to other modes.

The WMF says it secured $130,100.94 worth of cryptocurrency donations in 2021, making up just 0.08 percent of the total contributions it received.

Following the community’s vote, the WMF made the final call to discontinue cryptocurrency donations. Terming it as an “Ethical decision”, Wikipedia editor Molly White stated,

“I’m really happy that the Wikimedia Foundation implemented the request from its community, and I’m really proud of my community for making what I feel was the ethical decision after a lot of thoughtful discussions. There are just too many issues with crypto for any potential donation revenue to be worth the cost of helping to legitimize it.”

White also referenced web browser Mozilla’s decision to cease cryptocurrency donations in April after receiving backlash from users, developers, and one of its founders, Jamie Zawinski, for posting a tweet reminding users that it accepts donations in Bitcoin and Ethereum.

Wikimedia Foundation said it “will continue to monitor this issue”

Crypto proponents took to Twitter to share their views on the foundation’s decision. One user by the name of Mike Wille tweeted that the argument of environmental impact and power waste was also said about the internet in the early days.

“If you fail to understand the utility of something, any resource allocation is too much,” he quipped.

Others called the announcement a “Shortsighted and Clumsy” as there are many blockchains that are low carbon, and there is one [Algorand] that is carbon negative, but to fully shut down crypto support was like”throwing the baby out with the bathwater.”

The WMF summed up the post by saying it “will continue to monitor this issue” and will “remain flexible and responsive to the needs of volunteers and donors.”

Ireland Bans Political Parties From Accepting Crypto Donations

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Ireland has introduced election measures that make it illegal for political parties to accept crypto donations.

To fight possible Russian cyber-interference in Ireland’s democracy, new laws on political integrity will be implemented.

As part of a legislative overhaul, foreign contributions would be restricted, and parties will ultimately be compelled to declare all property holdings.

Ireland’s Local Government Minister, Darragh O’Brien, wrote to party leaders detailing a variety of steps he is adopting to resist foreign meddling in Irish elections.

The reforms include safeguards against disinformation campaigns on social media that might sway elections, as well as new legislation limiting how and from whom political parties can obtain funds.

All political parties must now be able to submit consolidated accounts that follow international accounting standards and best practices. In addition, party leaders will be required to sign certifications stating that they are in conformity with the new fundraising regulations.

Ireland has a past with Russia

O’Brien presented the Russian invasion of Ukraine as an example of how hazardous politically-charged disinformation is to democracies throughout the world.

“The heinous invasion of Ukraine and the devious misinformation campaign underline the basic vulnerabilities that all democracies face,” he stated.

In January 2022, O’Brien launched his policy reform campaign by directing Attorney General Paul Gallagher to assemble a task group of lawyers and political scientists to “construct a legal and digital bulwark against malicious influence in our elections.”

Russia’s meddling in Ireland recently has been subtle but considerable. In 2018, the government enacted emergency laws to prevent the Russian Embassy in Dublin from expanding further. Commentators speculated that the building was to house signals intelligence infrastructure.

The Conti assault, which entered the Health Service Executive (HSE) and knocked its computer systems offline in May 2021, demonstrates how a decline in broader security may impact Irish society in unanticipated ways.

The incident was alleged to have been carried out by the Wizard Spider crime organization, which is located in St. Petersburg, Russia.

Cryptocurrency has a turbulent past in Ireland. Last year, the country’s central bank governor warned that their popularity is “quite concerning.”

UN Body For Refugees Welcomes Its First Crypto Donation Of $2.5M

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UNHCR, the UN Agency for Refugees, has accepted its first stablecoin crypto donation of $2.5 million from the digital asset trading platform Binance which would be directed toward supporting individuals displaced from Ukraine due to the Russian invasion.

According to the blog published on the UNHCR website, the donation is intended to provide humanitarian, legal, and social assistance including psychosocial support and emergency shelter to people in need.

It is to be noted that over 10 million Ukrainians have been forced to flee from their home country since the war began. Around 4 million of them have managed to make it safely to neighboring countries like Poland, Moldova, Romania, and Hungary, while millions more have been pushed out of their homes but remain inside the war-torn nation. 

Anne-Marie Grey, Executive Director and CEO of USA for UNHCR spoke on the occasion,

Binance Charity’s commitment to the families fleeing the war in Ukraine shows the innovative philanthropic power of crypto in action. This generous support will make a life-changing difference for refugees, and more importantly, it shows families that a caring and committed global community is stepping forward to help during their darkest times.

Crypto Donations to Ukraine have reached $60 Million which have been utilized by the Ukrainian government to fund everything from body armor to medical supplies. The nation sold around $770,000 of what it refers to as museum NFTs, which debuted last week that showed scenes from the war.

Alex Bornyakov, deputy minister of Digital Transformation of Ukraine said, the Ukrainian government has spent about $41 million on items such as bulletproof vests, helmets, and medical supplies to date.

Refugees set to receive more support

Meanwhile, another pledged donation will be used to help refugees. Within a few weeks, about 66,000 Ukrainians will be receiving digital wallets with $300 of crypto, thanks to a $20 million donation gathered by the Stellar Development Foundation, Bornyakov said.

Coming back to Binance’s latest relief support, its charity wing has also launched a crowd-funding platform, which has raised approximately $900K USD from the crypto community. This fund will also be allocated to humanitarian efforts.

The BUSD donation has demonstrated the vital role of cryptocurrency in securing emergency funds and providing humanitarian aid for the crisis in Ukraine.