The Block, a media organization that covers cryptocurrency news independently, has been covertly financed for more than a year with money that has been channeled to The Block’s CEO from the infamous FTX founder Sam Bankman-Fried. The payouts, which The Block staff members were previously unaware of, might compromise the crypto news organization’s reputation and raise questions about its coverage of SBF, the now-defunct FTX, and its trading firm, Alameda Research.
SBF Funds $43Mn To CEO
The Block claims that from 2021 to this year, Michael McCaffrey, the ex-CEO of the crypto news website, obtained three loans totaling $43 million from SBF. The first loan was made in 2021 for $12 million to buy out other investors in the media organization, at which time McCaffrey assumed the role of CEO.
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The second was for $15 million in January to fund day-to-day expenses; while the third was for $16 million earlier this year for McCaffrey to buy private real estate in the Bahamas.
The Block’s CEO Resigns
However, in light of this exposé, The Block’s Chief Executive Officer, Michael McCaffrey, has resigned from the post. Bobby Moran will now be heading the news media website with immediate effect. In his official statement, he says:
No one at The Block had any knowledge of this financial arrangement besides Mike. From our own experience, we have seen no evidence that Mike ever sought to improperly influence the newsroom or research teams
According to The Block, McCaffrey will not only leave his position as CEO but also as the company’s board; which will now comprise of three members. The firm is currently looking to add two more people to the extended group to join Moran.
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The Block’s editorial leadership was taken aback by the news, and according to insiders, they are furious that McCaffrey failed to reveal such a significant financial arrangement with Bankman-Fried and Alameda, especially given that they are still covering the effects of FTX’s bankruptcy.
About The Block
The Block was established in 2018, and McCaffrey took the helm as CEO in 2020. The Block became 100% employee-owned with McCaffrey owning a majority stake in April 2021 after he arranged a buyout of the company’s investors.
The company, which is not profitable, previously raised nearly $4 million through convertible notes from venture capital firms like Greycroft, Pantera, BlockTower Capital, and Bloomberg Beta.
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