Sam Bankman-Fried (SBF), former CEO of now bankrupt crypto exchange FTX, gave $27 million in a series of undisclosed loans to Michael McCaffrey, CEO of crypto news website The Block, to help it stay afloat.
Bankman-Fried also loaned McCaffery $16 million, some of which helped him purchase property in the Bahamas, where FTX is headquartered, according to Axios.
McCaffrey has resigned after "failing to disclose a series of loans from disgraced former FTX head Sam Bankman-Fried's Alameda Research", The Block said late on Friday.
"He was the only person with knowledge of the funding at the company," it added.
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Bobby Moran, The Block's chief revenue officer, will step into the role of CEO, effective immediately.
Moran wrote in a Medium post that those loans, amounting to $27 million, were made by Alameda Research and the funds were used to effect the restructuring and provide working capital directly to The Block.
"This news came as both a shock and disappointment to The Block leadership team. McCaffrey's decision to take out a loan from SBF and not disclose that information demonstrates a serious lack of judgment," said Moran.
"As a result of his actions, we have asked him to step down. He will have no day-to-day management or operational responsibilities at The Block."
Meanwhile, SBF, facing charges of swindling billions of dollars, said he is not prepared to testify before a US Congress committee hearing on December 13.
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The US House Financial Services Committee is probing the controversial collapse of the crypto exchange that wiped out billions of investors' money.
According to reports, SBF "secretly transferred $10 billion in FTX client funds to his trading house Alameda Research".
FTX filed for bankruptcy last month after its possible merger with leading crypto exchange Binance did not materialise.
