FTX: In an atempt to get judicial security while it searches for a means to give users their money back, the insolvent cryptocurrency exchange FTX has filed for bankruptcy in the US. According to the organization, former head Sam Bankman-Fried has also resigned as CEO.
The 30-year-old, who oversaw the second-largest cryptocurrency exchange in the world, has experienced a dramatic shift in circumstances. His FTX empire’s demise in less than a week has shaken faith in the already unstable cryptocurrency market.
“I’m really sorry, again, that we ended up here. Hopefully things can find a way to recover,” The “King of Crypto,” Mr. Bankman-Fried, made a statement on Twitter on Friday.
Just before the market collapse, Mr. Bankman-Fried was a prominent figure in the cryptocurrency industry, often compared to business mogul Warren Buffett, with a net worth estimate of more than $15 billion (£12.8 billion) as of Monday.
However, this week’s early reports that FTX and other businesses owned by Mr. Bankman-Fried were in financial trouble led a large number of users to attempt to withdraw money from FTX, an exchange for buying and selling digital tokens.
Mr. Bankman-Fried attempted to organise a bailout while FTX was in financial trouble, but his efforts were unsuccessful, leaving the company scrambling to raise billions of dollars and many customers unable to access their money.
The business can carry on by declaring for Chapter 11 bankruptcy while reorganizing its debts under the watchful eye of the court.
“Begin an orderly process to analyze and monetize assets for the benefit of all worldwide stakeholders,” according to FTX, was the stated objective.
The FTX Group has important assets that can only be efficiently managed in an organized, cooperative approach, according to the new CEO John J Ray III, a lawyer with experience in high-profile bankruptcy cases and a background working at a venture capital firm.
According to the filing, FTX’s assets, liabilities, and number of creditors were between $10 billion and $50 billion.