WSJ: Sam Bankman-Fried sold $300 million worth of FTX shares during a 2021 fundraising round

FTX founder Sam Bankman-Fried sold a $300 million stake in the company to buy back Binance-owned shares, according to The Wall Street Journal, citing the exchange’s financial documents.

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In October 2021, FTX raised $420 million in a Series B-1 funding round. It was reported that the capital would be used to develop the business, for strategic investments and to expand its license portfolio.

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According to the WSJ, three quarters of the funds raised went to Bankman-Fried personally, who sold part of his stake in the company. The publication’s sources noted that the founder of FTX at the time described the transaction as a partial reimbursement of his costs for the Binance-owned share buyback.

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That deal was carried out in July 2021. In November 2022, Binance CEO Changpeng Zhao said that as a result of this agreement his company received about $2.1 billion in FTX (FTT) utility tokens and Binance USD (BUSD) stablecoins.

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According to court filings, filed in court by FTX’s new CEO John Ray, the stake previously owned by Binance passed to Paper Bird Inc., which is 100% owned by Bankman-Fried.

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Ray’s filing also notes that Paper Bird received a loan of $2.3 billion from Euclid Way Ltd., a company controlled by Alameda Research.

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According to a the Bitcoin exchange itself and Alameda Research study by Nansen, about 86% of FTT was originally controlled by that entity.

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