Not just crypto and blockchain ventures, but a news outlet too were “infected” with the Sam-Bankman-Fried money virus, who has recently been arrested in The Bahamas on December 12. The Block has become another entity to face the heat of FTX’s collapse, now being considered as one of the biggest or perhaps the biggest fraud in history.
Coinmarketcap said in a report that Sam Bankman-Fried “secretly funded” The Block, a news and content channel devoted to covering “digital assets”. It also said that the now ex-CEO, Michael McCaffrey, bought an apartment in The Bahamas from one of these loans.
In April 2021, The Block was struggling, and was restructured in an employee buy-out, and Michael McCaffrey became the CEO and its sole director. It is now revealed by Michael McCaffrey himself in a series of tweets that the money came from SBF. This was in the form of two loans worth $27 million that came into the hands of Michael McCaffrey and his separately owned company.
Mike McCaffrey (@McCaffrMike) tweet:
2/ In early 2021, The Block was in a precarious place, and I was evaluating whether to sell, merge or restructure. The only option that materialized was to restructure when I was able to obtain a $12 million loan for my holding company from SBF in Feb of 2021.
— Mike McCaffrey (@McCaffrMike) December 9, 2022
Michael McCaffrey says in subsequent tweets of the thread above that he “didn’t disclose the loan to anyone. Absolutely no one at The Block knew about the financial arrangement between my holding company and SBF, including the editorial and the research teams.”
According to Michael McCaffrey, he kept the funding a secret with a “rationale” – that revealing the source might compromise objectivity when SBF and related entities were the topic of news on the portal.
A third loan is also being reported, which went into buying an apartment. The Block now has a new CEO Bobby Moran, earlier its chief revenue officer, though Michael McCaffrey continues to hold the most shares.
Recently, The Block had announced its participation in Access Protocol for integrating a Web3 paywall for reading its news and content. A report in news outlet Axios, which broke the story, states the media site’s revenue to be around $20 million as revealed to it by an unnamed source.
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