Alameda Research, Sam Bankman-Fried’s company, confirmed the existence of 100 million BitDAO (BIT) in response to the community’s request. The day before, the DAO governance token price had fallen by about 33%.
1/2 Community update on BIP-4: the 100M $BIT has been transferred to the original BIP-4 swap wallet https://t.co/72FBhGieKY.
Thanks @AlamedaResearch @carolinecapital for the prompt response.
— BitDAO (@BitDAO_Official) November 8, 2022
Alameda received the assets in November 2021 in exchange for 3.36 million FTT tokens from the FTX exchange. The swap agreement provided that the parties would not sell each other’s coins for three years.
On November 8, the price of FTT over a few hours fell by about 30%. At the same time, BIT also fell sharply—from about $0.40 to $0.30 ( CoinGecko).
The BitDAO community suspected the company of breaching the lock-up terms and voted for proposal (BIP-4) to require Alameda to disclose within 24 hours the address storing the tokens. Otherwise, it was planned to decide how to handle the FTT assets in the treasury of the DAO.
Concerns were fueled by the presence of only 97 million BIT in the firm’s hot wallet, noted Colin Wu. Earlier, after CoinDesk’s investigation, rumors emerged of potential liquidity problems at Alameda and its closely linked FTX.
There are currently about 97m BITs in the FTX hot wallet, which is less than the 100m previously committed to hold, but there is not a huge selling. One possible interpretation is that Bybit saw signs that Alameda might sell, and gave advance warning. https://t.co/zAQZtl0qou https://t.co/IdziVYDWVm pic.twitter.com/rm1dDIvWfM
— Wu Blockchain (@WuBlockchain) November 8, 2022
«The BitDAO community is sceptical about the sudden dump of the BIT token, caused by Alameda’s selling and breaching the three-year public no-sale commitment», commented Bybit co-founder and CEO Ben Zhou.
Bitdao community is questioning the sudden dump of $bit token caused by Alameda dumping and breaching the 3 yr mutual no sale public commitment. Nothing is confirmed but bitdao community would like to confirm a proof of fund from Alameda. https://t.co/YassKhcdPt
— Ben Zhou (@benbybit) November 8, 2022
The head of Alameda, Caroline Ellison, said the company was not involved, and promised to respond to the request as soon as possible. BitDAO later confirmed receipt of the response:
«Update to the community: 100 million BIT has been transferred to the original swap wallet for BIP-4».
According to data from Etherscan, the assets arrived at the address from several sources, mainly from the FTX and Coinbase platforms.
«Thanks for the swift response, Caroline, it gave confidence to the BitDAO community. For those making hasty conclusions, nothing is confirmed and nothing proven. I am sure that Alameda will be able to navigate the current problems», wrote Ben Zhou.
Thanks for the swift response Caroline, this gave a lot of confidence to the Bitdao community. For others that are jumping into the conclusion, nothing is confirmed until proven, I am sure Alameda will be able to navigate the current straits. https://t.co/I4KZk9kdxa
— Ben Zhou (@benbybit) November 8, 2022
As of writing, the BIT price had risen back to above $0.39.
The Bybit-launched DAO attracted $230m from Peter Thiel, Alan Howard, Pantera Capital, Dragonfly Capital and other investors.
Read ForkLog’s bitcoin news on our Telegram — cryptocurrency news, prices and analysis.