Mike Belshe, CEO of crypto asset protector BitGo, confirmed that Alameda Research was trying to use 3,000 Wrapped Bitcoins (wBTC) in the days before FTX filed for bankruptcy on November 11. So he pointed out that Alameda is actually trying to sell wBTC, not Solana. Here are the details…
Alameda’s focus is on wBTC, not Solana
During a Twitter Spaces hosted by decentralized finance (DeFi) researcher Chris Blec on Dec. 14, Belshe denied the firm’s redemption request because the relevant unknown Alameda representative failed Bitgo’s security verification process and was unfamiliar with how Bitcoin was “wrapped.” He confirmed that he turned it down. Pointing out that the security details were not accessed through the process, the expert explained that for this reason, he opposed Alameda’s request.
Belshe said, “So we held and held it, and while we were waiting for a response on these issues, Alameda went bankrupt. Of course, everything stopped when they went bankrupt,” he added. The Bitgo CEO also said that Alameda’s 3,000 BTC minting request is “stuck” on the platform’s dashboard. He added that the firm will likely leave the tokens where they are until they are handled by the trustees who handled Alameda’s bankruptcy case.
Alameda tried to raise funds until the last moment
Alameda’s attempt to unlock 3,000 wBTC was also confirmed on Ethereum transaction aggregator Etherscan. However, while this would normally trigger the redemption of BTC, Bitgo has a security mechanism in place before the conversion took place, which Alameda failed to get past. The purpose of trying to buy back $50 million worth of wBTC was unclear.
However, it was understood that FTX executives were trying to collect funds from various sources until the last minute to avoid bankruptcy. Analysis by Arkham Intelligence on November 25 revealed that Alameda had withdrawn $204 million from eight different addresses from FTX US five days before the firm filed for Chapter 11.
BitGo holds over-collateralized wBTC
cryptocoin.com As we reported, wBTC is a tokenized version of BTC that can be used for BTC on other networks. The conversion is done at a ratio of 1:1. Tokenization of Wrapped Bitcoin allows Bitcoin holders to interact with Ethereum-based smart contracts and decentralized applications. Bitgo co-developed wBTC with Blockchain interoperability protocol Ren and multi-chain liquidity platform Kyber in 2019.
WBTC is also managed by the decentralized autonomous organization wBTC DAO, which consists of more than 30 members. The wBTC dashboard shows that BitGo is currently holding 202,255 BTC against 199,238 wBTC in circulation, which corresponds to an over-collateralization rate of 101.51 percent.
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