- Caroline Ellison texted FTX execs this month, worrying that "everyone is gonna quit/take time off."
- It's one of many internal exchanges reviewed by The New York Times about the collapse of FTX.
- FTX and Alameda Research filed for Chapter 11 bankruptcy protection three days after the text.
Earlier this month, Caroline Ellison, then the CEO of the hedge fund Alameda Research, sent a text saying she was "kinda worried that everyone is gonna quit/take time off" alongside a sweating-face emoji amid the collapse of its corporate sibling, the crypto exchange FTX, according to documents reviewed by The New York Times.
Ellison sent the text to a group chat with Ryne Miller, a top lawyer at FTX, around November 8, after FTX faced a run on customer deposits in the wake of a report that Alameda Research, the hedge fund led by the FTX founder and former CEO Sam Bankman-Fried, held an unusually large share of FTX's ftt tokens, which quickly lost value.
Alameda Research didn't immediately respond to a request for comment.
Ellison's text is just one of many exchanges reviewed by The Times that reflects the day-to-day chaos that brewed inside FTX as its executives scrambled to salvage the exchange.
The day Ellison sent the text, the crypto company Binance announced it signed a nonbinding agreement to bail out FTX by acquiring the company, Insider previously reported. But in a statement on November 9, the next day, Binance said it was walking away from the deal, citing government investigations and news reports of scathing criticism of FTX from its new CEO.
"Sam, I'm sorry," the Binance founder Changpeng Zhao texted Bankman-Fried in an exchange that was reviewed by The Times. "But we won't be able to continue this deal. Way too many issues. CZ."
On the day the deal fell apart, Miller responded to Ellison's text by saying that FTX was in need of "a professional manager vested with decision-making authority," The Times reported.
FTX filed for Chapter 11 bankruptcy protection days later. The company's newly appointed CEO, John J. Ray III, wrote in filings that FTX faced a "complete failure of corporate controls." He wrote he had never seen a company in such poor shape in his 40 years of handling bankruptcies.
Alameda Research and about 130 companies affiliated with FTX also filed for bankruptcy protection, Insider reported.