Sources: Alameda secretly loaned $43M to LLCs tied to The Block CEO Michael McCaffrey, used in part to buy and run the crypto news site; McCaffrey resigns

The Block, a media company that says it covers crypto news independently, has been secretly funded for over a year with money funneled …

Axios 2022-12-11 Sara Fischer

Context & Ripple Effects

The disclosure turns The Block’s claimed editorial independence into a governance issue: Alameda money reportedly reached the outlet through LLCs tied to its chief executive, rather than through a transparent ownership relationship. It also sits alongside reporting on Alameda’s earlier tolerance for risky investments, giving the financing arrangement added significance.

The outlet was later separated from its FTX-era financial ties through Foresight Ventures’ purchase of an 80% stake, indicating that ownership change—not simply the CEO’s departure—became part of the cleanup.

First-order effects

Michael McCaffrey’s resignation removes the executive whose LLCs reportedly received the Alameda loans, while The Block must address the conflict between its independence claims and its undisclosed funding.
Alameda’s reported $43 million financing becomes a credibility liability for The Block’s newsroom and commercial operation, particularly because the funds were used in part to acquire and operate the publication.

Second-order effects

The Block’s eventual majority-stake sale to Foresight Ventures gives the business a route to separate its ownership from FTX-linked financing, but makes ownership transparency central to rebuilding reader and advertiser trust.
Other crypto publications and their backers face greater pressure to disclose financing structures when investors or lenders are also subjects of their coverage.

Third-order effects

If crypto-media funding continues to be routed through executives or opaque vehicles, editorial-independence claims will increasingly depend on verifiable ownership and conflict disclosures rather than publisher assurances.
The episode is part of a wider crypto legitimacy gap, in which failures of governance at financial firms spread reputational risk to the information outlets covering them.

The trend: Crypto media is moving toward more scrutiny of ownership, financing, and editorial-conflict controls as FTX-linked relationships are unwound.

Discussion

@sarafischer Sara Fischer on x
1/2🚨Exclusive: Crypto news site @TheBlock__ has been secretly funded for over a year w money funneled to its CEO LLCs from #SBF's @AlamedaResearch —3 loans total: —$12M & $15M loans went to The Block —$16M used by CEO to buy real estate in Bahamas https://www.axios.com/... @axios
@mccaffrmike Mike McCaffrey on x
1/ I have difficult news to share. I'm stepping down as The Block's CEO. While it's personally painful, it's the right thing for The Block and the team.
@autismcapital @autismcapital on x
A confirmed FTX insider provides more color on the relationship between FTX and The Block: https://twitter.com/...
@tier10k @tier10k on x
[DB] The Block Has Been Secretly Funded for Over a Year With Money Funneled to the Block's CEO From SBF, Sources Told Axios.
@fintechfrank Frank Chaparro on x
1) I'm absolutely gutted by this news, which was briefed to the company this afternoon. Underpinning my shock are feelings of utter disgust and betrayal by Mike's actions, greed, lack of disclosure. He's literal scum. He kept every single one of us in the dark. https://twitter.co…
@punk6529 @punk6529 on x
enjoy this time. it is special. you will remember with nostalgia in a few years. (even the dumb stuff)
@mccaffrmike Mike McCaffrey on x
2/ In early 2021, The Block was in a precarious place, and I was evaluating whether to sell, merge or restructure. The only option that materialized was to restructure when I was able to obtain a $12 million loan for my holding company from SBF in Feb of 2021.
@nlw Nathaniel Whittemore on x
Easy bro. Make it right by distributing your shares amongst employees and investors who didn't know about your fraud. Do the right thing and see what your team built thrive... or slink off with equity worth nothing anyway. Seems simple. https://twitter.com/...
@zhusu @zhusu on x
Larry has “lots of funds stuck on FTX,” tweets about actively trading on news and exch listings, while having zero disclosures on those. Steven has “angel investor” in his profile while having zero disclosures on those. Frank's podcast was literally sponsored by FTX.
@albertwenger Albert Wenger on x
While I feel bad for people who were scammed, the #FTX #Alamada #SBF story really is the gift that keeps on giving https://twitter.com/...
@lawmaster @lawmaster on x
@ercwl I think the cherry on top is that I accidentally leaked my boss's secret loans from Alameda on Tuesday unknowingly. It's in this sheet https://twitter.com/...
@epsilontheory Ben Hunt on x
Between the collapse of crypto ad spend and the elimination of Bankman-Fried's shadow funding, is ‘crypto media’ even a viable business model? I don't see how it possibly is. https://twitter.com/...
@mccaffrmike Mike McCaffrey on x
7/ I apologize to my teammates at The Block. I am truly sorry for the lack of judgment. I have full confidence in the team to continue what they do best - delivering clear-eyed research and news in a space that now needs it more than ever.
@kyleldavies Kyle Davies on x
Dudas and Co, crack me up. Self proclaimed guardians of something, suckled the bosom of SBF, promote scams full time, flailing to find a new narrative to cling to. Sheep in need of a new shepherd
@realdannynelson Danny Nelson on x
Mike McCaffrey had a secret penthouse in the Bahamas but he was too cheap to buy his own $30 drink. I hope you enjoyed that Macallan, buddy. I didn't appreciate the bill.
@danheld Dan Held on x
Holy shit. Just when I thought the FTX drama had ended. https://twitter.com/...
@lawmaster Larry Cermak on x
Last few months really can't get much worse. Got fucked by FTX (after naively trusting them like a complete idiot) and now also got fucked by the CEO. Just like everyone else at The Block, I just found out about this. https://twitter.com/...
@mccaffrmike Mike McCaffrey on x
4/ I didn't disclose the loan to anyone. Absolutely no one at The Block knew about the financial arrangement between my holding company and SBF, including the editorial and the research teams.
@zhusu @zhusu on x
The idea that the CEO of the Block has been bribed massively, that the company has been de facto wholly owned by SBF for years now, yet the underlying reporting was solid, is mindboggling. SBF was solo source for many of their “scoops.” He ran the entire editorial direction.
@twobitidiot @twobitidiot on x
I've tried to operate ethically in this space for a decade but I'm starting to just feel guilt by association at this point. Disgusted and signing off.
@mashinsky Alex Mashinsky on x
As long suspected, major Crypto media was publishing false and misleading stories about Celsius and almost never covered any positive news Now we know why SBF/FTX saw Celsius as a critical competitor and wanted all these users for himself at all costs https://www.axios.com/...
@coinmamba @coinmamba on x
I always wondered why Block was making so many stories about Solana projects. Every day there was a story how some Solana project has raised couple millions.. https://twitter.com/...
@btcgandalf @btcgandalf on x
1/ Where SBF spent FTX customer's funds: - Making Binance/CZ richer by buying out their stake in FTX. - Purchasing real estate for himself, his parents, and Alameda employees. - Bankrolling The Block including loaning the CEO money to purchase Bahamian real estate.
@cobie @cobie on x
@mdudas ... So what actually happened? Mike (the other guy) was taking loans from SBF and putting the $ into The Block in exchange for favourable press?
@econoar @econoar on x
I don't think there was a conspiracy among Block employees to promote SBF due to the CEO loans. They likely had no idea. However, it was genuinely frustrating watching most all crypto media worship SBF and his projects without any criticism until the very end of the collapse.
@iamdcinvestor @iamdcinvestor on x
ok, i'll bite, who in the actual fuck is Mike McCaffrey? never heard of the slime bag before today second question: did he get unsecured loans from SBF/FTX/Alameda, or did he use his equity in The Block as collateral for the loans (or some other collateral)?
@cokiehasiotis @cokiehasiotis on x
I trusted my gut and left @TheBlock__ in 2021. Based on my time as Mike McCaffrey's Chief of Staff, I knew it was only a matter of time before he did irreparable damage to the company & its reputation because he is not a man of integrity https://twitter.com/...
@mdudas Mike Dudas on x
i have informed the new ceo of the block bobby moran that i would like to speak with him imminently there is a large group of honest people with capital, connections and a deep interest in honest crypto research & journalism who would like to ensure the block's continued success
@fintechfrank Frank Chaparro on x
3) Had I known about this, I would have not only called it out and disputed his actions, but called for an immediate change in leadership. Putting aside the FTX meltdown, there is no excuse for his deception and disregard for the 160 people who work at The Block.
@novogratz Mike Novogratz on x
Can we all move on from @SBF_FTX , @Mashinsky , @TheBlock__ , @zhusu and all the other scammers who have brought shame onto our industry. Delete them. Block them. Let the authorities deal with them. And let's move on the best we can to restore credibility to crypto.
@xbt002 Shas on x
1) I joined The Block in September as a long-standing critic of SBF, and the obvious cross-cubicle relationship between FTX and Alameda. I obviously had no knowledge of this, and it disgusts me. https://twitter.com/...
@iankar_ Ian Kar on x
Have said this before but reallyyyy think people should look into SBF having a stake in NYTimes, esp after the news around The Block. The NYTimes is publicly traded so SBF could have bought into it way more easily. And he's bought his way into other public co's, like Robinhood.
@zhusu @zhusu on x
Some unironic CT views I've seen: 1) ftx fraud doesn't matter, do another token and all is forgiven 2) doesn't matter if ftx orchestrated attack on luna/ust, would've failed anyway 3) CEO of The Block was bribed by SBF, doesn't mean any of the reporting was biased
@caseyjohnston Casey Johnston on x
im no rocket scientist but it seems like we should strive for a fourth estate where every tech outlet doesn't dive headfirst into the pockets of every new millionaire https://www.axios.com/...
@cobie @cobie on x
@AutismCapital I mean I get a good witch hunt n stuff but is this saying that Frank was favourable to FTX in 2020 because his boss would accept secret funding and a penthouse from Sam in 2021?
@lawmaster @lawmaster on x
@Lord_Ashdrake @AutismCapital Yea whoever that is is totally right I stood up for FTX when I said I thought near 0% chance that they are in trouble. Luckily I also advised everyone to take out money anyways. Obviously, in retrospect, I regret tweeting that but haven't deleted.
@pythianism Vance Spencer on x
in every case, it is important to not confuse the wrongdoing of a CEO with the wrongdoing of an entire company
@fintechfrank Frank Chaparro on x
Based on new information that's come to light I plan to speak with my colleagues about ensuring that Mike McCaffrey no longer controls a majority stake in the company or leaving
@sassal0x @sassal0x on x
Just woke up to the news My heart goes out to the good people at The Block - they didn't deserve this and I'm confident they'll bounce back from it.
@mdudas Mike Dudas on x
.@lawmaster and @fintechfrank are two of the best in the world at their crafts. They tolerated defamation crypto billionaire bullies and their armies slung their way with little financial reward always amazed me. You put a mark on their names, you're my blood enemy forever.
@tier10k @tier10k on x
Eventful day huh Condolences to all at The Block employees for being informed of this on a Friday btw if you see DB News LLC on the Bahamian land registry, my identity got exposed in the Equifax data breach Have a good weekend 🤝
@mdudas Mike Dudas on x
This is a lie on numerous levels. We had multiple sources of capital available, but Mike blocked them all. I was negotiating with a terrorist. https://twitter.com/...
@epsilontheory Ben Hunt on x
I mean ... what are we even doing here, people? https://twitter.com/...
@bitcoinissaving @bitcoinissaving on x
It all makes sense now. https://twitter.com/... https://twitter.com/...
@nlw Nathaniel Whittemore on x
The next time he gives the “aw shucks I goofed” routine, ask yourself what kind of person would be secretly funneling money for positive coverage for more than a year. That. Shows. Intent. Despicable. https://twitter.com/...
@jeetsidhu_ @jeetsidhu_ on x
what does it mean? https://twitter.com/... https://twitter.com/...
@defiyst @defiyst on x
According to SBF, the prime Bahamian real estate was reserved for FTX employees only. This doesn't seem to be the case https://twitter.com/... https://twitter.com/...
@fintechfrank Frank Chaparro on x
2) I put my trust in him to run The Block as an independent media entity as CEO and majority shareholder — and was misled. This is really painful because I've put many years into shaping The Block into what it is today. I also thought of him as a friend.
@lawmaster @lawmaster on x
I am proud of the 30+ person research team I built and will keep going with the new The Block leadership. It all really fucking sucks and I'm completely exhausted. Will be doing what truly matters and that's less Twitter and more time with my 4 month old daughter and my wife.
@lawmaster @lawmaster on x
Needless to say I didn't benefit from Mike's personal loans in any way. In fact, I lost roughly the same amount on FTX as I made from The Block's compensation and bonuses since joining 4 years ago. I never borrowed money from anyone either.
@fintechfrank Frank Chaparro on x
4) My track record as an independent reporter in the crypto space over the last five years speaks for itself. That's evident as recently as my no holds barred interview with Sam Bankman-Fried just last week.
@coffeebreak_yt @coffeebreak_yt on x
Wtf. Was everyone in crypto taking money from this guy? https://twitter.com/...
@hsakatrades @hsakatrades on x
We were so busy shitting on Trad media, we forgot to look in our own backyard. Among all the bodies washing ashore post FTX era, this is among the most putrid. Will take a while to reestablish credibility. The goblin priced The Block at ~2x of Kevin O'Leary
@fintechfrank Frank Chaparro on x
We wrote our first story on SBF in 2019 - Our events team has co-hosted events with a number of firms inc Genesis and Fidelity - I have interviewed as many FTX execs as Coinbase execs on my podcast https://twitter.com/...
@mccaffrmike Mike McCaffrey on x
5/ My rationale - undoubtedly poor judgment in hindsight - was that knowledge of the loan might be seen to compromise the objectivity of their coverage of SBF and his related entities.
@hsakatrades @hsakatrades on x
The goblin bought every entity that could serve as its mouthpiece. There was always a distinct difference in the tone between pieces covering SBF/FTX/Alameda and other exchanges. Always been hyper cynical, but do extend the benefit of doubt to the employees being in the dark. htt…
@mccaffrmike Mike McCaffrey on x
6/ I never attempted to influence coverage of FTX, Alameda or SBF. Nevertheless, my decisions undermine the credibility of The Block - and the talented people who work non-stop to cover this complicated and evolving industry.
@tier10k @tier10k on x
One $16m batch of funding from Alameda was used in part to purchase of an apartment in the Bahamas for Block CEO Michael McCaffrey McCaffrey has resigned as CEO and is leaving the company The newsroom was informed in an all-hands meeting early Friday afternoon. 1) What https://tw…
@mdudas Mike Dudas on x
one thing about the unfortunate block news today every scammer: “look, the entire enterprise was compromised from day one, i'm totally vindicated even though civil and criminal courts will rek me soon” normals: “this is really sad, that unethical ceo f*cked the honorable team” ht…
@twobitidiot @twobitidiot on x
If @mdudas really wants to try to buy back The Block, I'll support him if I can. Or pursue the business myself. The top news desks serve as critical checks on industry excess, AND entities that provide oxygen to all of the good in crypto. Good journalism is undervalued.
@ryanjamesweeks Ryan Weeks on x
Depressing, baffling news. What angers me most is that we are now forced to defend our work - which I've been particularly proud of this year - because of the actions of one person. Bitterly disappointing. https://twitter.com/...
@mdudas Mike Dudas on x
This is false. Get ready from more of this from “citizen journalists”. This is why @McCaffrMike's betrayal is so devastating. https://twitter.com/...
@axios @axios on x
The Block, a media company that says it covers crypto news independently, has been secretly funded for over a year with money funneled to the CEO from Sam Bankman-Fried's cryptocurrency trading firm. https://www.axios.com/...
@iamdcinvestor @iamdcinvestor on x
this is...not great i hope and expect that @TheBlock__ @fintechfrank will be as forthcoming about this situation as possible, and will established enhanced governance and processes to ensure such a potential conflict of interest does not arise again https://twitter.com/...
@mayazi Maya Parody on x
List of media outlets SBF invested in to drive his image while he was “distracted” (that we know of): - the Block - Semaphore - Axios But it's just crypto ppl who think the entire coverage of FTX was biased https://www.reuters.com/...
@jespow Jesse Powell on x
Shocking but not surprising. Every “journalist”, editor and publication observed openly fellating Sam's cucumber in the past month needs to be investigated. https://twitter.com/...
@autismcapital @autismcapital on x
Axios reports that The Block has received over $27M in funding from Sam/FTX including financing for a $16M apartment in Albany for Block CEO Michael McCaffrey. https://www.axios.com/...
@saylor Michael Saylor on x
Sam used stolen & counterfeit money to corrupt the establishment & undermine #bitcoin. This is just the tip of the iceberg. How many other journalists, academics, money managers, politicians, charities, influencers, & lobbyists did he corrupt or co-opt? https://www.axios.com/...
@adamscochran Adam Cochran on x
Honestly anyone questioning Frank or Larry here is a dumbass. When I started raising issues about FTX, Frank was one of the only people to take it seriously & investigate and he worked his ass off fielding leads while other outlets wrote fluff pieces. https://twitter.com/...
@zosegal Zach Segal on x
I've been in crypto for a decade and seen many meteoric rises and falls. This looks bad. However, I still believe @lawmaster and @fintechfrank are high integrity, and this looks like an enormous betrayal of trust by their former leader. https://twitter.com/...
@bitboy_crypto Ben Armstrong on x
You can't understate how important this is. I've been telling you Alameda had an entire propaganda arm that disseminated misinformation at will regarding projects, individuals, & exchanges. Time to pull the thread and see how deep it goes. https://twitter.com/...
@mdudas Mike Dudas on x
Horrifying. Devastated beyond belief. I was given less than an hour's heads up by the CEO of @TheBlock__. If you think you're shocked, I'm literally lost right now. https://t.co/J0MH1wDrfz
@hudsonjameson Hudson Jameson on x
I 100% trust that @fintechfrank, @lawmaster, and the rest of the journalists and researchers at The Block were in the dark about this awful leadership decision. Some people are not going to believe them, but if you do believe them consider publicly or privately expressing that. h…
@ddiamond Dan Diamond on x
Former POLITICO revenue chief Bobby Moran stepping in as The Block's new CEO. https://medium.com/... https://twitter.com/...
@joshconstine Josh Constine on x
This is nuts and underscores why editorial independence from ownership is critical. If you let someone tell you what or how to write, you can't be sure of their motives. Good to hear The Block's team didn't know, and has been fiercely critical of SBF https://www.axios.com/...
@tomaxwell @tomaxwell on x
This is really tough for me, but today I'm coming clean I have also received $43 million from FTX, including $18 million which went towards my condo in Nassau
@iohk_charles Charles Hoskinson on x
Remember all that anti-cardano coverage... https://twitter.com/...
@jeffjohnroberts Jeff Roberts on x
Block statement addresses editorial concerns of SBF scandal but not financial ones. So: Did CEO pledge any of Block's assets as collateral? What were terms of the loans? Is Block in financial jeopardy if receiver overseeing FTX bankruptcy calls in the loans?
@venturecoinist Luke Martin on x
So SBF actually owned the Block too... ‘The Block CEO received three loans. The first was $12 million and was used in 2021 to buy out other investors.’ Starting to think I'm the only one that didn't receive funding from SBF last year. https://www.theblock.co/...
@robinwauters @robinwauters on x
I also know a publication with a, let's say *interesting* cap table, constant lack of disclosures and conflicts of interest 🙈🙉🙊 https://twitter.com/...
@teroterotero Tero Kuittinen on x
I mean crypto boyz keep the drama alive https://twitter.com/...
@lynaldencontact Lyn Alden on x
Another week, another revelation for how deep SBF's monetary tentacles extended throughout the industry. https://twitter.com/...
@johnbiggs John Biggs on x
Amazing. I mean arguably Coindesk lives on Barry Silbert's cash as well but this is some super cheeseball stuff from McCaffrey. SBF secretly funded crypto news site https://www.axios.com/...
@swagtimus @swagtimus on x
Every day I think to myself the crypto industry can't possibly become more of a clown show, and every day I get proven wrong. Note: I have respect & empathy for the employees, this is directed at their former CEO. https://twitter.com/...
@timccopeland Cope on x
Here's our official statement. Please read. https://www.theblock.co/...
@colinwilhelm Colin Wilhelm on x
Some news about our company that the newsroom learned this afternoon. We have provided, and will continue to provide, independent coverage. https://www.theblock.co/...
@amuse @amuse on x
The dominos are still falling... https://www.theblock.co/...
@jacqmelinek Jacquelyn Melinek on x
Former CEO McCaffrey received 3 loans from SBF in total: - $12M in 2021 to buy out The Block - $15M loan in January to fund day-to-day operations - $16M earlier this year to buy real estate in the Bahamas https://www.theblock.co/...
@theblock__ @theblock__ on x
CEO Transition https://medium.com/...
@adamscochran Adam Cochran on x
The important tagline here is “without the newsroom's knowledge” so we should want the execs out and newsroom keeping on. Some BS on the part of leadership there. https://twitter.com/...
@alexandre_lores Alexandre Lores on x
Not to be confused with @TheLatestBlock! @MatiGreenspan @ger313 @_CryptoCurator https://twitter.com/...
@jeffgiesea Jeff Giesea on x
I feel for @mdudas @fintechfrank and employees of the crypto-focused media company @TheBlock__. By all indications they were blindsided by news of their CEO's sketchy, undisclosed financial relationship with SBF. Disgraceful. https://www.axios.com/...
@sarafischer Sara Fischer on x
@TheBlock__ ... 2/2 The site has never disclosed any connections to SBF or Alameda —Employees had no idea, found out today —CEO resigning and stepping off Board —Company will look to restructure to buy out CEO's stake (He's currently majority shareholder) Read on @Axios: https://…
@adamscochran Adam Cochran on x
Wait, this included a fucking personal $16M loan for the CEO to buy Bahamas real estate? What the utter fuck. https://twitter.com/...
@samro Sam Ro on x
“$16M used by CEO to buy real estate in Bahamas” https://twitter.com/...
@anthony Anthony DeRosa on x
The Block, a media company that says it covers crypto news independently, has been secretly funded for over a year with money funneled to The Block's CEO from the disgraced Sam Bankman-Fried's cryptocurrency trading firm https://www.axios.com/...
@fredbenenson @fredbenenson on x
ah yes, it is the mainstream press that SBF has had under his thumb, yes yes https://twitter.com/...
@alexandergrieve Alexander Grieve on x
His tentacles are everywhere. IMO all the proof needed that @TheBlock__ employees didn't know / weren't coerced into favorable FTX reporting is the grilling of SBF last week by @fintechfrank 🫡 Great people there, who don't deserve this. (I feel like this is a recurring theme) htt…
@domschiener Dominik Schiener on x
This is why Crypto can be so frustrating. You don't know who pays who, and what their (hidden) incentives are. Some people are only interested in protecting and pumping their own bags. They're not here to decentralize, they are here purely for selfish gains. Good riddance. https:…
@jeffjohnroberts Jeff Roberts on x
The Block is latest to be covered with SBF slime. They will be fine. Block has a strong bench with Frank, Larry et al and I hear it's adding media grown-ups to its board. This will pass The lesson (again) for crypto is stop putting faith into whiz kids and hype. https://twitter.c…
@novogratz Mike Novogratz on x
Do people still “believe” SBF?? Enough already!!! https://twitter.com/...
@coffeebreak_yt @coffeebreak_yt on x
My heart goes out to the journalists at the Block who reportedly didn't know. that's going to be a stain on the company that's hard to erase. https://twitter.com/...
@sarahnemerson Sarah Emerson on x
“The payments, which employees of The Block were previously unaware of...” https://www.axios.com/...
@mikeisaac Rat King on x
this is nuts. feel bad for the editorial staff who didnt know how much the (now former) ceo was totally screwing them https://www.axios.com/...

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