Stanford University, one of the United States’ most prestigious higher education institutions, has made the decision to return all donated funds received from the now-defunct cryptocurrency exchange, FTX. The move follows a lawsuit aimed at recovering these funds.

Why Stanford Is Returning FTX Donations

According to a statement obtained by Bloomberg, a spokesperson for Stanford University revealed that they had been engaged in discussions with FTX debtors’ attorneys, ultimately deciding to return the funds in their entirety. The university acknowledged that donations from the FTX Foundation and related entities were primarily intended for pandemic-related prevention and research initiatives.

This decision by Stanford University comes after FTX made allegations in a recent filing, asserting that the parents of SBF (Sam Bankman-Fried), the key figure behind FTX, had exerted pressure to secure significant donations, with Stanford University being one of the recipients. Specifically, the filing claimed that Allan Joseph Bankman, SBF’s father, directed over $5.5 million in donations from the FTX Group to the university between November 2021 and May 2022.

The alleged motive behind Bankman and his wife, Barbara Fried’s, actions was to enhance their professional and social standing. Notably, both Bankman and Fried are long-time professors at Stanford Law School, providing a potential explanation for the university’s inclusion among the beneficiaries of the alleged donation scheme.

However, it appears that Stanford University wishes to distance itself from what could potentially become a protracted legal battle. SBF’s parents have vehemently denied the allegations, refuting them as “completely false” in response to FTX’s lawsuit. They have also characterized the timing of the lawsuit as suspect, as it coincided with their son’s impending trial.

Part of FTX’s Recovery Efforts

While FTX’s lawsuit against SBF’s parents and institutions like Stanford is a noteworthy aspect of the company’s recovery endeavors, it represents only a small piece of the puzzle as the exchange strives to settle debts and potentially relaunch its operations.

Recent court filings have revealed that FTX has managed to recover approximately $7 billion, with over $3.4 billion coming in the form of cryptocurrency assets. The company has pursued debtors such as Genesis and investigated potential charitable donations made by Sam Bankman-Fried to specific organizations.

In a further step toward recovery, FTX has also filed lawsuits against various individuals and entities in an effort to recoup payments made for promotional purposes. Among those targeted are prominent figures like Kevin O’Leary, a businessman, renowned athletes such as Trevor Lawrence and Naomi Osaka, and even the Golden State Warriors professional basketball team.

Disclaimer: The information provided in this research report is for informational purposes only and should not be interpreted as financial or investment advice. The NFT and cryptocurrency market is highly volatile, and readers should conduct thorough research before making any investment decisions.