Further details emerge on FTX bankruptcy
Further details on the bankruptcy of crypto exchange FTX emerged on Saturday, even as peers and partners distanced themselves from the firm and sources told Reuters at least a billion dollars of customer funds on the exchange had vanished.
The saga that has shaken the crypto world began with a rumour on November 2 and culminated on Friday with FTX filing for US bankruptcy court protection from creditors and founder Sam Bankman-Fried resigning as Chief Executive in the industry’s highest-profile collapse.
The distressed crypto trading platform had struggled to raise billions to stave off bankruptcy as traders rushed to withdraw $6 billion from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal this week.
“FTX, affiliated crypto trading firm Alameda Research and about 130 of its other companies have commenced voluntary Chapter 11 bankruptcy proceedings in Delaware,” FTX said on Friday in a statement on Twitter.
In a follow-up tweet, FTX said that subsidiaries LedgerX LLC, FTX Digital Markets, FTX Australia Pte Ltd, FTX Capital Markets, Embed Financial Technologies and Embed Clearing were not included in the Chapter 11 filings.
People familiar with the matter told Reuters at least $1 billion of customer funds have vanished from FTX.
Bankman-Fried secretly transferred $10 billion of customer funds from FTX to Alameda, they said. A large portion of that has since disappeared.
Published in The Express Tribune, November 13th, 2022.
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