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94% Of FTX’s Blockfolio Buyout Was Paid Using FTT Crypto: Report

Defunct cryptocurrency exchange FTX (CRYPTO: FTT) used its own exchange token, FTT, to pay for the acquisition of the tracking website Blockfolio in 2020.

Around 94% of the $84 million deal was paid for with the FTT tokens that FTX created, according to financial documents, Bloomberg reported.

The financial details of FTX's acquisition of Blockfolio were previously unknown.

See Also: Crime And Entanglement – How FTX's Bankruptcy, Alameda CEO's Guilty Plea Went Down

The information comes in response to a complaint filed yesterday by the U.S. Securities and Exchange Commission (SEC), which claimed that FTT is a security.

FTX used the money it received from the sale of FTT tokens to support its commercial activities.

FTX co-founder and former CEO Sam Bankman-Fried is currently being held by the FBI and faces eight federal criminal charges.

In addition, Caroline Ellison, the former CEO of the sibling trading company Alameda Research, and Gary Wang, the co-founder of FTX, have both entered guilty pleas to criminal charges.

The SEC stated that FTT was promoted as an investment contract and is a "security," a move that is certain to have a significant impact on the crypto sector.

Any price increase in FTT would benefit holders of FTT equally and in direct proportion to their FTT holdings, the agency explained.

"The large allocation of tokens to FTX incentivized the FTX management team to take steps to attract more users onto the trading platform and, therefore, increase demand for, and increase the trading price of, the FTT token," it added.

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