FTX Insurance Fund Value Inflated by Code, Not Backed by Real Funds: Executive

FTX's insurance fund value was fabricated using Python code, not real funds according to Gary Wang

The code multiplied daily trading volume by ~7,500 to generate a fake "insurance fund" value

The fund was touted in ads and social media but often had insufficient funds to cover losses

In 2021 a trader exploited a bug, nearly wiping out the fund; Alameda was made to "take the loss"

Wang claims SBF prompted "allow_negative" balance feature so Alameda could trade with unlimited liquidity