FTX Used Identities of Thai Se Workers to Access $1Billion in Frozen Crypto

Prosecutors looked at testimony from former Alameda Research ‘chief executive officer’ Caroline Ellison as part of their investigation into FTX CEO Sam Bankman-Fried, whose global enterprise involved the quick movement of money and cryptocurrency.

Ellison testified that she had attempted to access frozen funds on the cryptocurrency exchanges Huobi (now HTX) and OKEx (now OKEx) by opening accounts using the identities of “Thai prostitutes.” The plan finally fell through.

The over-the-counter (OTC) trading desk Genesis Block, based in Hong Kong, was another part of Bankman-Fried’s financial empire with connections to Thailand.

In the Bankman-Fried empire, Genesis Block is best recognised as the location where people lined up with bags full of cash to buy cryptocurrency.

According to reports, the desk is “integrated” with either FTX or Alameda Research; in fact, the Genesis Block website states, “Alameda Research will also provide the technology that acts as the backbone for Genesis Block’s new OTC portal.”

Clement Ip, one of the desk’s original founders, served on the board of directors of FTX Hong Kong.

FTX Links to Thailand

The FTX bankruptcy has also uncovered a “Digital Assets Accounts Control Agreement Dated 11/3/2020” between Genesis Block Limited and an FTX Group business, as well as a “Loan Agreement Dated 12/10/2021” between the two.

Genesis Block’s presence in Thailand is one of the company’s less publicised facts, but it was not hidden and was announced on the official website. Block Mountain conference-goers in Thailand who stopped by the Thank You Party hosted by Genesis Block Thailand and FTX might have even gotten a hint about the connection.

Since the Thai office’s website appears to be a poorly implemented copy of the main Hong Kong website, it is difficult to determine the full activities beyond sponsorship of events in Thailand. However, LinkedIn pages suggest that the focus was more explicitly on “educational talks and meetups” than the main Hong Kong-based office.

A former Genesis Block partner may have provided a hint when he or she revealed that the company used dozens of “satellite” bank accounts to facilitate the transfer of payments. Charles Yang, partner and lead trader at Genesis Block, acknowledged that this is “a very grey area.”

Genesis Block has always benefited from Yang’s wide network of contacts; his bio on the company website calls him “a Hong Kong-bred Korean,” and adds, “Charles leveraged his multicultural background as he built his network with Korean corporations and institutions.”

According to the evidence, the seyouncharles88@gmail.com account is the famed ‘Korean buddy’ account, and it just so happens that FTX relied on an account affiliated with a ‘Charles’ for its activities.

Relationships with Chinese OTC traders

The interesting nature of this connection is heightened by the fact that Yang has been introduced as a “principal” of Alameda Research at a number of different events.

It’s unclear whether or not Genesis Block Thailand was utilised by FTX and Alameda Research to maintain the network of bank accounts described by their Korean acquaintance, or how much reliance each company had on the other.

Wincent Hung, founder of Genesis Block, serves as director of several related companies. These include China Genesis Block Limited, Genesis Block Limited, and Genesis Block OTC Limited. According to his bio, he has “strong relationships with Chinese OTC traders.”

On Wednesday, a forensic accountant in Sam Bankman-Fried’s trial attempted to determine what happened to the missing $9 billion from FTX customers’ accounts. The bookkeeper responded, “Oh, yes,” when asked if FTX had ever stolen customer money.

According to CoinDesk on Thursday, an expert witness named by the prosecution, University of Notre Dame accounting professor Peter Easton, testified that user payments were used to reinvest in businesses and real estate, make political contributions, and donate to charity.

Easton emphasises many key transactions in which SBF participated but client money were necessary for completion. As far back as an interview with ABC’s George Stephanopoulos in November 2022, the FTX founder flatly denied knowing “that there was any improper use of customer funds.”

Genesis Digital Assets

In June of 2022, when Alameda Research was supposedly holding $11.3 billion in customer funds, FTX actually only had $2.3 billion in its bank accounts. As early as March 2021, Easton discovered consumer money were no longer guaranteed.

According to Easton, clients’ money went to SkyBridge Capital, led by Anthony Scaramucci, and Modulo Capital, led by Lily Zhang. In March of 2023, Modulo Capital explained the wrongful transfer of $404 million to FTX. Also, FTX consumers may not have realised they helped finance a $550 million investment in Genesis Digital Assets, a cryptocurrency mining company.

Aditya Baradwaj, a former employee of Alameda Research, revealed the true extent of SBF’s $133 million in political donations throughout the trial. In addition to donating millions to both the Republican and Democratic super PACs and other organisations, SBF also gave his father, Joseph Bankman, $10 million.

Nishad Singh, Head of Engineering at FTX, testified earlier in the week that he felt “betrayed” by SBF. Singh claims he is mostly to blame, and his testimony supports the prosecution’s case that SBF was the real mastermind behind the FTX fraud. Two months before the rest of the world, Singh discovered the deception, but he stayed to attempt to preserve the ship.

I couldn’t bear the thought of having caused an avoidable downfall by leaving. What Singh testified to in court.

During his last several months at FTX, the head of engineering had concerns about the company’s finances. The “wrong question,” SBF responded to Singh’s inquiry about the company’s deficit, was “how can we deliver?”

The original version of this article was first published in Prontos.