A Founder Continues to Hold $500M Received from SBF

Rashad Makhat, a Kazakhstan-based businessman and former jujitsu platform, continues to hold $500 million in investments received from the Sam Bankman-Fried-led FTX and sister company Alameda Research, a WSJ report details.

According to that report, Makhat sold his shares in the bitcoin-mining enterprise, worth Genesis Digital Assets, to Bankman-Fried. The deal was finalized just months before FTX collapsed in late 2021.

Since its Chapter 11 proceedings began, the new administration of the crypto exchange has tried to recover funds spent by SBF in what they refer to as a “spending spree.” That includes money spent on company acquisitions, assets purchased, and money received by SBF parents.

WSJ report indicates that Makhat’s lawyers in London confirmed the founder remains in possession of the proceeds. During the Sam Bankman-Fried trial, the deal with Makhat was highlighted as one of the reckless spending endeavors undertaken by the troubled crypto founder.

Prosecutors used bank account data and insider testimony to demonstrate how much of the $8 billion in consumer funds moved into startups and other investments. Last year, Bankman-Fried was found guilty of money laundering allegations and is currently in detention awaiting sentencing.

Late last year, the crypto trading platform unveiled a new repayment plan to settle creditors’ claims. However, the plan was met with heavy backlash as creditors claimed it undervalued the worth of their assets.

Specifically, the repayment plan valued crypto assets as of when FTX collapsed In November 2022. As of then, crypto prices were deep into the bearish zone, with the flagship cryptocurrency, Bitcoin, trading at around $16K. Crypto prices have since recovered since mid-last year.