On December 4, 2022, a report detailed that FTX-based synthetic stocks could have been used to manipulate the value of AMC shares. In May 2021, FTX offered 36 tokenized shares but speculators believe whether the company actually holds real shares in the first place is questionable.
FTX has listed 36 synthetic shares and minted hundreds of thousands of tokenized shares, the report questions whether the company actually owns the shares.
FTX has been under a microscope ever since the exchange collapsed in the first week of November 2022. Since then, there has been a lot of work to do and new information to be released. On Sunday, a report details that crypto shares listed on FTX could have been used to “manipulate the price of AMC shares.” Publications thechainsaw.com and report shows that while FTX’s terms of service state that the company’s synthetic stock is backed 1:1, that may not be the case.
“Bundled AMC Tokens Listed on FTX[s] to trade on its synthetic derivatives trading platform,” Chainsaw’s Twitter account details. “[Etherscan.io] currently shows that there are 545,000 synthetic AMC tokens on the Ethereum blockchain. FTX claims that the underlying stocks are overseen by the asset manager [CM Equity AG],” Chainsaw’s tweet added. The publication’s Twitter account continued:
However, a recent rectification from CM Equity shows that the company ended its relationship with FTX in December 2021, which means that FTX lied about custody of AMC tokens in good time. than by 2022.
The report indicates that FTX’s Terms of Service says: ‘Buyers of fractional shares have no underlying delivery requirements’
In addition, thechainsaw.com published a report that the details shared by Gamestop and Tesla may also have been manipulated. Furthermore, the researchers note that the leaked FTX balance sheet revealed by the Financial Times (FT) shows that the company holds only shares of Robinhood (HOOD). There is no public document (as of now) that shows that FTX actually owns any of the 36 tokenized stocks it has listed.
Furthermore, in Sam Bankman-Fried’s (SBF) interview about Mario Nawfal’s Twitter spaceSpeculators have accused the SBF of describing a system where tokens and BTC can be printed out of thin air. Additionally, as SBF left Nawfal’s Twitter Spaces interview, an individual accused FTX and Alameda of printing tokens out-of-the-box to manipulate the value of his project’s token list. Furthermore, thechainsaw.com reporter Tom Mitchelhill said that FTX “intentionally lied” about its crypto offering.
“Despite clear statements from the FTX website assuring investors that they can redeem their tokenized assets for the underlying at any time, let’s take a closer look at the FTX Private Terms of Service for Tokenized Stocks and Main Information Document state: ‘Buyer of Fractional Stocks has no underlying delivery requirement,'” Mitchelhill wrote. “This ultimately means that FTX intentionally lied and mislead customers on its official website and went directly against their own terms of service.” The Mitchelhill report further suggests that “inconsistencies regarding their listing and custody” can literally be applied to anything FTX has to offer.
What do you think of the possibility that FTX’s tokenized shares are used to manipulate the real stock price? Let us know your thoughts on this topic in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
deny the responsibility: This newspaper only gives true information. This is not a direct offer or solicitation to buy or sell, or to recommend or endorse any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.