FTX Used Python to Generate Fake Insurance Fund Amount: Gary Wang
The post FTX Used Python to Generate Fake Insurance Fund Amount: Gary Wang appeared on BitcoinEthereumNews.com. FTX cofounder Gary Wang said that the real insurance fund balance was lower than the amount displayed on the platform’s website. He gave evidence that the exchange used the random number, nearly 7500 multiplied by the platform’s daily volume and then divided by one Billion to decide the amount of cash added to the fund. However, the real amount was different and lower than what was shown on the website. He also confirmed that the displayed number did not match the real number in the data and the real insurance fund balance was lower than what was shown to the public. The prosecutor, Nicolas Roos questioned whether the number has to do anything with the actual number in the insurance fund. To this, Wang replied “No.” Gary Wang: Insurance Funds Displayed Were Fabricated In the October 6 testimony, Gary Wang said that $100 Million in insurance funds in 2021 was not the reality and did not actually contain any FTT, FTX’s native token. The prosecution argued that the FTX insurance fund amount was fake and was calculated on random numbers. The co-founder added that these numbers of the insurance fund are made to protect user losses in case of sudden activity in the market. These numbers were even approved and shown on the FTX website and social media. A Python code was used to misprint the value of its insurance fund. Wang added that the pool of funds set aside to deal with unforeseen losses was insufficient. He further added that he was told to make Alameda take on the loss. This was done to hide the loss, as Alameda’s balance sheets were more private than those of FTX. Insurance funds are protection to pay out profits and cover losses. This avoids instinctive closure of profitable positions caused by widespread…
The post FTX Used Python to Generate Fake Insurance Fund Amount: Gary Wang appeared on BitcoinEthereumNews.com.
FTX cofounder Gary Wang said that the real insurance fund balance was lower than the amount displayed on the platform’s website. He gave evidence that the exchange used the random number, nearly 7500 multiplied by the platform’s daily volume and then divided by one Billion to decide the amount of cash added to the fund. However, the real amount was different and lower than what was shown on the website. He also confirmed that the displayed number did not match the real number in the data and the real insurance fund balance was lower than what was shown to the public. The prosecutor, Nicolas Roos questioned whether the number has to do anything with the actual number in the insurance fund. To this, Wang replied “No.” Gary Wang: Insurance Funds Displayed Were Fabricated In the October 6 testimony, Gary Wang said that $100 Million in insurance funds in 2021 was not the reality and did not actually contain any FTT, FTX’s native token. The prosecution argued that the FTX insurance fund amount was fake and was calculated on random numbers. The co-founder added that these numbers of the insurance fund are made to protect user losses in case of sudden activity in the market. These numbers were even approved and shown on the FTX website and social media. A Python code was used to misprint the value of its insurance fund. Wang added that the pool of funds set aside to deal with unforeseen losses was insufficient. He further added that he was told to make Alameda take on the loss. This was done to hide the loss, as Alameda’s balance sheets were more private than those of FTX. Insurance funds are protection to pay out profits and cover losses. This avoids instinctive closure of profitable positions caused by widespread…
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