The Curious Case of a $7 Million ‘Trump Lose’ Holding on FTX’s Balance Sheet

Sam Bankman-Fried speaks on stage at Casa Cipriani in New York on June 23, 2022. Craig Barritt/Getty Images for CARE For Special Children

With crypto exchange FTX’s implosion triggering worries in the sector, Ken Griffin, the CEO of hedge fund Citadel, highlighted a curious item on the exchange’s balance sheet—a crypto token called TRUMPLOSE valued at over $7 million.

“You know, on the balance sheet at FTX there’s a line called ‘Trump Lose.’ And Sam was the second biggest donor of the Democratic candidates,” Griffin said during an interview with Bloomberg on Tuesday referring to FTX founder Sam Bankman-Fried. “Those are really, really ugly facts when you see a fraud of this nature having played out and you find no regulators were there to prevent it. That’s a really, really tough story.”

FTX filed for bankruptcy last week after concerns about its balance sheet triggered a large number of depositors to withdraw funds from their accounts, pushing the exchange into a liquidity crisis. On FTX’s balance sheet, the TRUMPLOSE token is shown as having a value of $7.39 million.

During the 2020 presidential election in the United States, FTX ran a series of prediction markets where traders were allowed to buy one of the two tokens—TRUMPWIN or TRUMPLOSE.

A buyer of TRUMPWIN would get $1 for each token if Donald Trump had won the election, failing which the token value would resolve to zero.

Similarly, a buyer of TRUMPLOSE would win $1 for his token should Trump lose the election, failing which this token would end up with zero value.

The $7.39 million TRUMPLOSE position on FTX’s balance sheet is an illiquid asset as the 2020 election is long over, according to a report by CoinDesk.

Supporting Democrats

FTX founder Sam Bankman-Fried has a deep connection with Democrats. The exchange was founded just after Biden announced his bid for presidency in 2019.

According to data from Open Secrets, Bankman-Fried was the second largest individual donor to Democrats in the 2022 election cycle, coming behind George Soros who is at the top with $128 million in contributions.

Bankman-Fried’s mother, Barbara Fried, was a co-founder of the “Mind The Gap” PAC which aimed to provide funding to Democrat candidates.

According to Influence Watch, Mind The Gap “is known for its secretive operations where it attempts to quickly gather and coordinate donations over a short time to prevent Republicans from mobilizing donors in response.”

Bankman-Fried’s brother Gabe Bankman-Fried started a company called “Guarding Against Pandemics,” which aimed to “support” the $30 billion allocated by the Biden administration for pandemic planning.

The FTX founder had also attempted to influence public policymaking. He championed a bill called the “Digital Commodities Consumer Protection Act of 2022” proposed in August by Senate Agriculture Committee Chair Sen. Debbie Stabenow (D-Mich.).

The bill aimed to grant regulatory power over the crypto industry to the U.S. Commodity Futures Trading Commission (CFTC). Earlier in February, Bankman-Fried had donated $5,800 to Stabenow’s campaign.