The Block CEO Resigns After Ties With FTX Come To Light

The crypto market is struggling to get out of a bearish period mainly caused by the collapse of FTX. Yet, the infamous crypto exchange continues to bring down companies and prominent crypto personalities.

This time, Michael McCaffrey, the CEO of crypto news website The Block, resigned after failing to disclose loans from FTX founder and former CEO Sam Bankman-Fried’s Alameda Research.

As per McCaffrey’s LinkedIn, he joined The Block in 2018 and worked as the staff manager and COO before becoming the CEO.

The Block has declared its former chief revenue officer, Bobby Moran, the new CEO. In addition, the company seeks to hire more team members to expand the publication.

That said, Moran has also addressed concerns regarding the integrity of the news publication:

“No one at The Block had any knowledge of this financial arrangement besides Mike. 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.”

Detail On Loans And Company’s Restructure Plan

According to Moran, McCaffrey discussed sourcing a loan to restructure the company and directly pouring the funds into The Block. The former CEO decided to secure the first loan from Bankman-Fried.

The Block announced the management buyout in April 2021, with the first batch of loans amounting to $12 million. Notably, a second loan amounting to $15 million was used to run everyday operations.

The Block CEO Resigns After Ties With FTX Come To Light
Cryptocurrency market trends sideways | Source: Crypto Total Market Cap on TradingView.com

McCaffrey took another loan of $16 million besides the previous two loans. However, this time, the funds were not used to help in boosting operations, but for personal needs.

According to a report, the former CEO used the third loan to buy property in the Bahamas. However, the report further revealed that nobody in the company knew this.

The Block, Pro-SBF And FTX?

Even though Moran has already addressed concerns over the publication’s integrity, some Twitter users think otherwise. One user even went on to write The Block was “super pro-sbf.”

Previously, the news director of The Block, Frank Chaparro, interviewed SBF to discuss the aftermath of the crypto exchange’s implosion on YouTube. Another user wrote on Twitter:

Internal Team’s Take On The News

Chaparro claims the former CEO kept the entire team in the dark, and that he felt “misled.”

“I put my trust in him to run The Block as an independent media entity as CEO and majority shareholder — and was misled. This is painful because I’ve put many years into shaping The Block into what it is today. But, I also thought of him as a friend.”

A few days ago, Larry Cermak, The Block vice president of research, gathered a list of Alameda Research’s investments, and it included the loans that the platform took. However, the report did not reveal any financial ties with the platform.

The Block’s financial disclosure page clearly states, “fully transparent about our own financial holdings to avoid any appearance of bias or impropriety”.

The Block CEO Resigns After Ties With

One prominent user claims that SBF was directing the editorial. Twitter user @Zhusu supported this statement and posted a series of tweets.

Featured image from Pixabay, chart from TradingView.com

You May Also Like