The enigma of the cryptocurrency sector has taken another twist as Matthew Graham of Sino Global Capital files a $67.3 million claim against FTX Trading Ltd. This claim comes on behalf of Sino’s Liquid Value fund, a venture rolled out in partnership with Sam Bankman-Fried last year.
The fund set its sights on raising $200 million, primarily from high net worth individuals. This was a drift from Sino’s usual course as it was their inaugural expedition into soliciting external capital via an established fund medium.
FTX was underlined as a “co-GP and anchor LP” in promotional materials for the fund, hinting at immense strategic value tied to Bankman-Fried’s token universe. In early 2022, the fund had already amassed $90 million, with FTX as crucial investor.
Previously, Sino Global held a straightforward position about its “direct exposure to FTX exchange being limited to mid-seven figures held in custody.” According to Securities and Exchange Commission (SEC) filings, Bankman-Fried was outlined as an indirect investor in the fund, alongside other heavyweight names including Alameda Research, subsidiary Alameda Ventures, and Graham himself.
However, the tides have turned. The once SEC-registered fund is now active only with the Cayman Islands Monetary Authority. A representative from Sino Global mentioned that the fund’s investing endeavors were heavily concentrated on infrastructure and gaming.
The situation became tumultuous following FTX’s collapse. In response, Sino expressed its deep regret for misplaced trust but stood firm on its belief that they anticipated FTX to uphold the integrity of the industry.
In a subsequent move, former FTX COO Constance Wang, once considered a vital player in Bankman-Fried’s fundraising efforts, was brought on board by Sino Global as its head of gaming. This situation brings to light the volatility inherent to the crypto market, shining a spotlight on the alliances formed, the trusts broken, and strategic maneuvers executed within its complexed universe.
Whether Sino’s claim against FTX will bear fruit is unknown. However, one thing is certain – this saga embodies the paradox of the crypto domain, where breathtaking opportunities and daunting challenges co-exist. The constantly evolving narrative of the crypto market continues to raise questions on industry standards and practices, leaving us on the edge of our seats, waiting for the next development eagerly.
Source: Coindesk
