FTX Made Secret Payment To Australian Influencer

By Anthony • June 5, 2024 9:10 am • Comments

A new report filed in a Delaware court reveals that FTX paid an Australian influencer $17.5 million who previously owed millions of dollars to investors.

In 2022, Australian crypto influencer Alex Saunders raised over $15 million through loans and ill-fated business proposals prompted by his Nugget’s Newsgroup.

Saunders then allegedly sent the funds to FTX, which collapsed in November of last year.

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After receiving no returns on their investments, investors reportedly grew weary and reached out to Saunders, who later revealed he was a mess due to opiate abuse and promised to pay the investors back.

Now, a new FTX bankruptcy report revealed that FTX backed Saunder’s investment.

Crikey reported, “Saunders was loaned US$13.2 million (A$17.5 million at the time) through a Cayman Islands company, 707,016 Ltd., which was set up on behalf of FTX in July 2021.”

The loan description was “to pay off the creditors of Alex Saunders.”

Per Crikey:

The mysterious source of $17.5 million given to an Australian cryptocurrency influencer who owed millions of dollars to investors has been quietly revealed in a report filed to a Delaware court.

In 2022, Alex Saunders, a Tasmanian cryptocurrency content creator and founder of paid cryptocurrency news Facebook group Nugget’s News, blamed opioid abuse and mental health problems for a “mess”, following 2021 investigations by the Australian Financial Review into his business dealings.

These reports claimed Saunders had raised $15 million through personal loans and ill-fated business proposals he promoted in the Nugget’s News Facebook group.

The funds were allegedly sent to FTX, one of the world’s most popular cryptocurrency exchanges until its sudden collapse in November 2022. Saunders’ apology claimed he repaid, or was in the process of repaying, all those who had given him money.

Thanks to the FTX bankruptcy report by examiner Robert J. Cleary filed late last month, we now know who backed Saunders and his promise to make investors whole: FTX itself.

The report states Saunders was loaned US$13.2 million (A$17.5 million at the time) through a Cayman Islands company, 707,016 Ltd., which was set up on behalf of FTX in July 2021. The loan was “to pay off the creditors of Alex Saunders” after he “used borrowed funds to trade on FTX.com, but lost the funds that he traded”. FTX had loaned this significant sum to “avoid negative publicity”, “mitigate reputation harm” and “avoid potential litigation”, Cleary wrote.

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