- Sam Bankman-Fried was a big proponent of Solana, a layer-1 blockchain that bills itself as a faster alternative to Ethereum’s network.
- He backs projects in that ecosystem and his company has amassed a huge amount of the blockchain’s native token, also known as Solana (SOL).
- Altcoins have fallen 96% from their all-time highs in November 2021, wiping out tens of billions in market cap.
Sam Bankman-Fried was a big proponent of Solana, a layer-1 blockchain that bills itself as a faster alternative to Ethereum’s network.
The infamous former cryptocurrency mogul backed projects within the ecosystem and his company amassed a huge amount of money, also known as Solana (SOL), the blockchain’s native token.
But since Bankman-Fried’s FTX filed for bankruptcy on Nov. 11, the altcoin has plunged 46%, down 96% from its November 2021 high, Messari said Thursday. Once boasting a market value of nearly $80 billion, he is now just $3.4 billion.
Here are some of the bonds the founders of FTX and Solana formed.
Bankman-Fried, who is currently facing multiple fraud charges, previously told Fortune that Solana could be a critical infrastructure for the future of digital assets.
“They were by far the most serious [layer 1] We discussed expanding their blockchain and continuing to expand the opportunities,” he said in an email.
He started Serum, a decentralized exchange built on blockchain, and has also invested in several projects built on Solana’s network.
Meanwhile, Bankman-Fried hedge fund Alameda Research and cryptocurrency exchange FTX have purchased a large amount of SOL tokens from the Solana Foundation, a nonprofit that supports blockchain, and Solana Labs, a blockchain developer. Did.
The deal between the two companies and the Solana Foundation and Solana Labs includes 58 million SOL tokens, worth $543 million based on current cryptocurrency prices.
Anatoly Yakovenko, co-founder and CEO of Solana Labs, told Bankman-Fried’s Bloomberg: “I feel really, really uncomfortable.”
According to the blog post, the Solana Foundation had approximately $1 million in cash or cash equivalents on FTX.com when the trading platform stopped processing customer withdrawals in early November. This was less than 1% of his foundation cash or cash equivalents and no SOL held on exchanges.
Solana co-founder Raj Gokal said the organization had no idea how FTX and Alameda’s assets would be handled during the bankruptcy proceedings, saying that “the SOL token will not be on Alameda’s balance sheet.” There is no security impact on the network due to concentration or anything like that,” he added.
However, following the fall of FTX, popular projects built on Solana such as y00ts and DeGods decided to leave that network in favor of Polygon and Ethereum. That is despite the fact that about 80% of Solana’s projects on the blockchain have no exposure to FTX at all, Yakovenko told Bloomberg.
“Solana definitely has more features than FTX,” he said.
Gokal believes the dispute over the failed Solana and Bankman-Fried companies will eventually end. “Krypto’s memory is pretty short,” he said.
