Former FTX Executive Accused of Fueling a Charity Through Discounted FTT Purchase

According to a report citing anonymous sources, the former FTX executive allegedly made a profit for charity by purchasing discounted FTX tokens, FTT, before they were made available to the public at a price of $0.05 per unit. Ruairi Donnelly, a former FTX chief of staff, was accused of donating tokens to Polaris Ventures, a Swiss-based charity that later sold FTT for millions of dollars.

Anonymous sources claim that Polaris Ventures received most of its fortune from the FTT transfer in 2019.

According to report from the Wall Street Journal (WSJ) on Tuesday, a charity affiliated with the FTX executive benefitted by receiving ftx (FTT) tokens at a discounted price. The issue is Polaris Ventures, a Swiss organization that claims to support artificial intelligence (AI) and effective altruism, anonymous sources familiar with the matter told the WSJ.

One particular AI organization that Polaris Ventures supported was the Artificial Intelligence Co-operative Foundation, which received $15 million to support its cause and research. WSJ reporter Alexander Saidi cites anonymous sources who claim that former FTX chief of staff Ruairi Donnelly purchased FTX tokens (FTT) at a discounted price of $0.05 per unit, which was reportedly the FTX employee rebate in effect at the time.

Sources claim that Donnelly used $562,000 of his salary to acquire FTT at that price. Saidi’s report suggests that Donnelly then donated the funds in the form of a Polaris grant, and that “the fund made millions of dollars selling tokens after they began publicly trading at $1 in 2019 and 2020 when Mr. Donnelly was still working in FTX.

Donnelly’s attorney stated that the FTT in question is not owned by FTX and is intended to pay unpaid wages to his client. “To be absolutely clear, the FTT that Mr. Donnelly ordered to be transferred on his behalf to Polaris was not FTX funds,” the attorney said. The lawyer also noted that $30 million of Polaris funds are stuck in FTX and that the fund is the main creditor in the FTX bankruptcy.

The anonymous sources cited in the report also suggest that most of the fund’s wealth originally came from the 2019 FTT transfer. The same sources concluded that Donnelly is currently trying to sell the bankruptcy loans for a fraction of their value.

What do you think about the Polaris Ventures case and FTT deal in 2019? Share your thoughts in the comments below.

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