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FTX – the failed crypto exchange that Sam Bankman-Fried founded – seems to have spent millions of dollars to buy a luxury castle in the Czech Republic thanks to an obscure non-profit organisation linked to the "altruism efficiency" movement.
Following a $4.5M grant to the European Summer Program on Rationality (espr), the group spent approximately $3.5M on the estate.
How about a charity castle?
According to Forbes FTX did not disclose the donation before being closed in December. However, Irena Kotikova, a former Czech Association for Effective Altruism chairperson who applied for the grant, confirmed to the outlet that the distribution of funds took place in July 2022
Specifically, Kotikova claimed that a group called FTX Philantropy Inc. – later renamed to FTX Foundation – had issued the grant agreement. That entity is not registered as a debtor in the FTX bankruptcy proceeding.
"It has not yet been determined what exactly was the source of our funding and whether it is being filed for bankruptcy," said Kotikova.
A portion of the ftx grant agreement required all donations to be spent. So, most of the funds went to buy a business that owned the Czech castle "Hostavoc Castle."
TripAdvisor describes Hostavoc Castle as "a Renaissance castle hidden in central Czech Republic... which guarantees you peace, quiet and serenity."
Dating back to 1297, The Hasa family made the castle a 17-room hotel in 2007, with "a dining room, pool, escape room, tennis courts, and Frisbee golf course," Forbes said.
Kotikova argued to prohibit the castle from being used as a venue for events for 60 to 100 people. Although she did not indicate which projects her organization had in mind, she did say that it was not an effective altruistic project.
FTX "Altruism Efficiency"
Of their own free will, there was nothing unusual about FTX donations. The FTX Foundation pledged to allocate 1% of FTX’s revenue to charitable causes in 2021. Later, the exchange launched a $100 million humanitarian fund with a specific focus on “effective altruism.”
Following FTX’s November blowup, however, the team behind the future fund resigned citing “fundamental questions about the legitimacy and integrity” of the operations funding FTX’s charity programs.
Effective altruism is a social movement and philosophy that focuses on making as much money as possible to give back. Former FTX boss Sam Bankman-Fried often advocated this way of thinking, stating once that "I wanted to get rich not because I love money.
FTX has since been widely accused of defrauding its customers of billions of dollars by misappropriating their assets for trading at Alameda Research.
