Alameda Research, the trading firm affiliated with the now-bankrupt cryptocurrency exchange FTX (FTT-USD), was said to have been secretly funding crypto news site The Block for more than a year, The Block confirmed in a Friday report.
Michael McCaffrey, The Block's CEO, immediately stepped down from his role after he failed to disclose the Alameda-backed loans, the company said, adding that he was the only person who knew about the funding.
McCaffrey, who will also step down from The Block's board, received three loans from Alameda totaling $43M from 2021 through 2022, the company noted. The first loan amounted to $12M and was used last year to buy out other investors in the news site. That's when McCaffrey took over as CEO.
The second loan, which was used to help fund day-to-day operations, consisted of $15M in January, and the third one was for $16M earlier in 2022 to buy personal real estate in the Bahamas, where Sam Bankman-Fried's FTX is headquartered, The Block explained.
Meanwhile, The Block’s chief revenue officer, Bobby Moran, was said to succeed McCaffrey as CEO effective immediately. “From our own experience, we have seen no evidence that Mike ever sought to improperly influence the newsroom or research teams, particularly in their coverage of SBF, FTX and Alameda Research,” Moran said in a statement.
Earlier, Sam Bankman-Fried said he was willing to testify before U.S. House Committee next week.