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Ex-FTX executive’s charity made millions from insider deal on FTT

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Ex-FTX Executive's charity made millions from insider deal on FTT

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  • Polaris Ventures reportedly sought to receive roughly $150 million from FTT’s sales.
  • The foundation has made millions of dollars selling the tokens after they were publicly traded at $1 in 2019 and 2020.

Polaris Ventures, a charity founded by former FTX and Alameda chief of staff Ruairi Donnelly, reportedly sought to receive roughly $150 million from the bankrupt exchange’s employee token sales.

According to the Wall Street Journal on 14 February, Donnelly earned approximately $562,000 in salary during his tenure at FTX. His salary was converted into FTT at $0.05, a rate not available to the public. As per the report, the former executive donated the tokens to Polaris Ventures, selling them for $1 when public trading opened in 2019 and 2020, making millions.

FTX donated the token to the charity he co-founded in Switzerland. Furthermore, the foundation made millions of dollars selling the tokens after they were publicly traded at $1 in 2019 and 2020.

FTX crash sent shockwaves across the industry

FTX declared Chapter 11 bankruptcy in November 2022; later, many wallets and funds associated with the exchange were seized or otherwise frozen for legal proceedings. Donnelly is reportedly looking to cash out the $150 million during public scrutiny of FTX and Alameda, as well as their former CEOs.

Jason P.W. Halperin, Donnelly’s lawyer, said to the Wall Street Journal:

“The FTT that Mr. Donnelly directed to be donated on his behalf to Polaris were not FTX’s funds.”

As FTX navigated Chapter 11 bankruptcy, Polaris’ assets worth $30 million remained out of reach. According to the report, the company had approximately $150 million in assets at press time.

In December, debtors at the exchange said that they would arrange for the return of funds donated to charities or campaign contributions and threatened to sue if any group refused to pay with interest.

Many regulators have announced investigations into charitable groups amid FTX’s bankruptcy proceedings in the United States. Moreover, in January 2023, the Charity Commission for England and Wales announced that it had launched an investigation into Effective Ventures because FTX was a significant funder of the organization.

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Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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