Were his parents actively involved in it?

How much they knew is an open question.

FTX funds were used to buy them a beachfront property as a vacation home. Apparently they were aware before the bankruptcy that this was not SBFs personal gift. And in fairness they are now offering to return it.

https://finance.yahoo.com/news/sbf-parents-ftx-executives-bo...

I’ll never understand why they were doing this kind of stuff when they had a good viable business as an exchange and the volume of transactions meant even a small percentage fee would generate massive amounts of profit. Greed is a hell of a drug I guess.

It baffles me too. Alameda made perfect sense when it was making money and providing liquidity. But it's time was over since it had no actual edge in the space except for being first (and there were now 101 other smarter, faster entities competing with it). If he'd just let it die gracefully he'd still be Mr Popular and Respectable...