Written by mah dude, Stickyv35 :
TL;DRS: They lied about having shares to back up the tokenized GME offerings. We know they lied. They know they lied. We know that they know, they lied. They know that we know, they lied.
Brett Harrison, President of FTX.US, did an AMA with Superstonk in Sept. 2022. During the interview, he stated these GME tokenized stocks were fully collateralized, aka, backed 1:1 with real shares, held by a German broker. Additionally, it was claimed that one could exchange the token for shares upon demand.
Fast forward 2 months, Nov. 2022 (lol), FTX files for bankruptcy as a wave of customer withdrawals and collapse of their utility token FTT outpaced the available liquidity & remaining assets on balance.
Now that FTX has filed bankruptcy, information is surfacing via court filings to show their claim of “full collaterization” was a complete lie and material/criminal misrepresentation. Neither the German broker-dealer, FTX or any of its affiliates actually held GME shares against these tokens. So they were fraudulent – big surprise right?
Therefore, it’s believed with a high degree of certainty that broker-dealers, prime brokers and other institutions accepted GME tokenized stock as a short sale locate due to the alleged convertability to real shares, thereby keeping the traditional stock borrow fee low and providing infinite locates to sell against. This kept expenses on their already existing stock loans artificially low and helped reinforce their short position during periods of extreme price pressure, such as March ’21, June ’21, November ’21, March ’22, June-Sept ’22 and so on.
However, all this did was buy them time as retail has never stopped and will never stop buying and registering until we lock the float. The cat is out of the bag, DRS and pure DRS by book is bleeding them dry one share at a time.
Apes aren’t going anywhere and shareholders are continuing to accumulate real shares through Computershare.
The Big shorts and their accomplices are unequivocally fucked.
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Mah dude Lunar_Stonkosis further adds:
GME was blowing up the shorts and they almost went bankrupt in January 2021 but in the last minute they criminally stopped people from buying the stock and created a shitload of digital tokenized stock?
These tokens were a desperate solution created to provide locates for creating synthetic shares to feed into the frothing market and limit the impending blow-up and inevitable bankruptcy of involved, overleveraged short hedgefunds?
They were created by what now seems to have been just a shell company with a moronic childish leadership that were stupid/greedy enough to accept doing the bidding of their evil hedgie overlords?
The shell company postulated and “guaranteed” that the tokens were backed 1:1 with GME stock – in order to allow the rehypothecation and synthetic short selling of GME and other “meme stock” shares?
So this little maneuver bought the SHF another year or two, but it also solidly sealed their eventual fate – because there are now an unfathomable amount of synthetic shares floating around?
And now that FTX is blowing up and shit’s coming to light, we can see that the tokens were in fact not backed by real shares and that the SHF are more naked and more FUK than ever before?
And all I have to is just DRS the fake shares they sold me and watch the fireworks??!