Sam Bankman-Fried continues to save the crypto industry

Sam Bankman-Fried once again proved he is the savior of the crypto world this week when he won the auction for the assets of Voyager Digital’s controversial broker.

The second-youngest billionaire (after his FTX co-founder Gary Wang) is no stranger to pitching in with lines of credit and bailouts to ease the woes of some of the year’s most troubled companies. It is therefore not surprising that the 30-year-old has been compared to JP Morgan during the crisis of 1907.

Bankman-Fried’s bailouts began late last year, when FTX provided a $120 million credit line to Liquid after hackers stole from the Japanese exchange. FTX bought the exchange in April this year, although it did not disclose how much.

As the crypto market faced a deepening liquidity crisis following the May crash of the terra and luna tokens, Bankman-Fried began handing out lines of credit to seemingly any firm on the brink of collapse, totaling about $750 million between FTX and his. quantitative research firm Alameda.

In late June, as crypto asset manager BlockFi laid off 20% of its staff and sought to raise capital at a reduced valuation, Bankman-Frieds provided FTX US with a $250 million revolving credit facility. In July, when the crypto market fell below 2021 levels for the first time, the credit line was extended to $400 million along with the option to be bought out by FTX US for up to $240 million.

Alameda Research, the quantitative research firm owned by the same holding company that owns FTX.US, joined the apparently benevolent spree, giving Voyager a $200 million cash and USD coin and 15,000 bitcoin line of credit following defunct crypto hedge fund Three Arrows Capital (3AC ) defaulted on a loan, worth at the time $675 million.

After Voyager filed for Chapter 11 bankruptcy in early July, Bankman-Fried first made an offer to the crypto broker for its clients. FTX.US would purchase all of Voyager’s digital assets and customers would then be able to open FTX accounts with a portion of their bankruptcy claims. Voyager initially rejected FTX’s offer, saying that “no customer would be made whole” under the plan.

But the arrangement the brokerage accepted today does not look much different. His winning bid of $1.422 billion for the brokerage’s crypto assets included $1.3 billion for the current market value of the currencies themselves and another $111 million in “incremental value.” The 8% premium also provided FTX access to Voyager’s customers – says a spokesperson Forbes that “the money will effectively go to the customers, as opposed to the company/management.”

Alameda Research, which originally provided Voyager with the line of credit and was listed as a creditor in the filing, still has an outstanding payment to Voyager, even though FTX.US is buying crypto assets. A New York court ordered the research firm to repay the $200 million crypto loan it sought in September 2021 by the end of this month.

A notorious crypto failure not under Bankman-Fried’s wing? Celsius network. FTX agreed to a deal with the beleaguered crypto lender after looking at the financials, Block reported. Celsius CEO Alex Mashinsky resigned today with immediate effect.

However, all these bailouts may be a distraction from FTX’s own problems. FTX USA President Brian Harrison said he would step down and leave the US crypto trading section of the exchange. Although neither Harrison nor Bankman-Fried addressed the reason for his departure, there may be a decline in unique visitors to the site.

FTX.US unique visitor volume underperformed other US exchanges, with visitors falling 42% since April this year. Coinbase, Gemini and Binance US saw visitor declines in the range of 22-27% in the same time frame.