Sam Bankman-Fried Funds Modulo Capital To The Tune Of $400 Million

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According to media reports, Sam Bankman-Fried (SBF), a disgraced former FTX CEO, sent $400 million to Modulo Capital, a little-known cryptocurrency hedge fund run by a former Jane Street trader. Modulo was founded in March 2022 before being the recipient of one of SBF’s largest investments while he was in charge of FTX.

According to reports, the company was based out of the Albany Resort, the same opulent building where SBF resided. Other FTX employees stayed in condos or villas rented by the company, while Bankman-Fried resided in a $30 million penthouse at the resort.

Xiaoyun Zhang & Bankman-Fried Relationship

According to the NYT, Duncan Rheingans-Yoo, one of the founders of Modulo, had just completed his undergraduate studies two years prior to founding the business. SBF had dated Rheingans-business partner Yoo’s partner Xiaoyun Zhang, also known as Lily, in the past. She once had a romantic relationship with Bankman-Fried.

According to a spreadsheet posted by the Financial Times in December 2022, Bankman-other Fried’s company, Alameda Research, invested $250 million and $150 million in Modulo Capital in the third and fourth quarters of 2022.

Sam Bankman-Fried: Investment Raised Questions

SBF’s decision to invest millions in a trading start-up while his companies were losing money has attracted the attention of law enforcement officials, according to reports. Thereby, the federal prosecutors in Manhattan were looking into SBF’s Modulo investment to see if it was made with illegal proceeds.

In the meantime, Modulo’s assets are being investigated by legal counsel for the new leadership of FTX in an effort to recover the billions of dollars that were lost when the cryptocurrency exchange failed.

Federal investigators have already taken over $500 million from Bankman-Fried, including $50 million held in the tiny Farmington State Bank, but they are still looking for more.

Duncan Rheingans-Yoo and Xiaoyun Zhang have hired Aitan Goelman, a criminal defense lawyer and former director of enforcement for the Commodity Futures Trading Commission, despite the fact that neither of them has been charged with a crime (CFTC).




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