Alameda Research Suddenly ‘Goes Dark’ On Crypto Trades, Source Says

It marks a stark reversal from the prop trading firm’s mammoth unwinding yesterday

article-image

FTX’s Sam Bankman-Fried | Blockworks exclusive art by axel rangel

share

Embattled crypto proprietary trading and venture capital firm Alameda Research has gone dark and stopped trading with at least one regular counterparty, according to a source familiar with the matter. 

Once high-flying traders at Alameda, owned by FTX CEO Sam Bankman-Fried, spent most of Tuesday unwinding a slew of positions in an attempt to ease mounting liquidity issues exacerbated by market turmoil surrounding Binance’s sudden move to acquire FTX. That deal has since fallen through

Alameda, meanwhile, has taken down its website, which now reads, “this site is currently private.” And there’s an expectation of a pending leadership shakeup, a second source said — following executive turnover earlier this year.

“The great crypto reset is here,” the source said. “Dark days ahead.”

The source categorized Alameda’s rapid move as “highly unusual,” pointing to the fact that the trading firm still has a great deal of open positions on its balance sheet. The asset manager stopped trading with one — and likely two — trading partners Wednesday morning in New York after being in near-constant communication with its counterpart desks yesterday, the source said.

A spokesperson for Alameda declined to comment. The source was granted anonymity to discuss sensitive business dealings. 

“They were incredibly engaged sellers in the market rout yesterday,” the source said. “They had to be. It’s unusual for them to [out of nowhere] stop responding to me. It’s super, super rare.”

What led to the unexpected trading halt isn’t clear. 

Possible explanations include:

  • A directive from senior management to wait for markets to settle, considering both Alameda and FTX have been hammered by the plunging price of the exchange’s native token, FTT.
  • A wait-and-see approach on the outcome of the Binance acquisition of FTX, which has now been resolved. Binance pumped the brakes on what had been a pending purchase, Blockworks reported.
  • There’s been chatter among deep-pocketed industry participants — including TradFi players — that Alameda’s insolvency woes are deeper than has previously been reported, suggesting a vulture-style purchase of the firm could be possible. A second source said institutional asset managers have been inquiring about snapping up the firm’s cryptoassets at bargain-basement prices, as well as broaching the idea of an outright acquisition. 
Tags

Upcoming Events

HYATT REGENCY SALT LAKE CITY

TUES, OCT. 8, 2024

Guided by the expertise of Blockworks Research Analysts team, this one day event will feature senior leaders, entrepreneurs, and developers from across the crypto industry. Attendees will have the opportunity to participate in an immersive experience to explore the latest trends, […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

hivemapper.jpeg

Research

We believe crypto market participants overlook Hivemapper’s fundamental potential due to a poor understanding of both the niche map data market and Hivemapper’s positioning relative to incumbents. Hivemapper’s token model catalyzes both a cost and product advantage via unmatched map freshness and near real-time accuracy, which is its wedge into a market characterized by stale data and high data collection costs. Its current and potential future product suite may represent one of the strongest possibilities for PMF in crypto today.

article-image

Exploit shows centralization can sometimes be an asset

article-image

The Fidelity Ethereum Fund, like other proposed ETH ETFs, seeks to stake a portion of its assets, according to the firm’s Wednesday registration statement

article-image

The DAO first voted on enabling SAFE transfers over a year ago

article-image

The final Bitcoin halving, where the mining reward becomes smaller than one satoshi, is expected to occur in 2140

article-image

The Department of Justice and Commodity Futures Trading Commission announced back-to-back lawsuits against KuCoin Tuesday

article-image

Judge Failla found that Coinbase didn’t operate as an unregistered broker in offering its wallet service