After a week-long liquidity disaster adopted by a withdrawal freeze, FTX has formally filed for Chapter 11 chapter.
In the meantime, its high-profile chief and former multi-billionaire – Sam Bankman-Fried (SBF) – has resigned as CEO.
- In a press release on Friday, FTX introduced that it has commenced Chapter 11 proceedings in the USA alongside over 130 affiliated corporations.
- A kind of corporations is Alameda Analysis – a buying and selling desk launched by SBF considered deeply intertwined with FTX.
- FTX’s new CEO, John Jay Ray III, acknowledged that Chapter 11 is required to permit FTX to guage is state of affairs. He stated its purpose is to maximise recoveries for stakeholders.
“The FTX Group has valuable assets that can only be effectively administered in an organized, joint process,” he continued. “I want to ensure every stakeholder that we are going to conduct this effort with diligence, thoroughness, and transparency.”
- SBF issued a press release shortly afterward, clarifying that FTX US had additionally filed for chapter. Days earlier, the ex-CEO said over Twitter that FTX US “was not impacted” by the fallout.
“Hopefully things can find a way to recover. Hopefully, this can bring some amount of transparency, trust, and governance to them,” he stated.
- Zane Tackett, former Head of Institutional Gross sales at FTX, claimed on Friday that FTX had over $8.8 billion in liabilities on its present steadiness sheet. In the meantime, its complete belongings have been solely price $6.1 billion in complete, of which solely $900 million have been “liquid assets.”
- FTX froze withdrawals beginning on Tuesday, and has thus far solely resumed withdrawals for folks within the Bahamas, on regulator’s orders.
- Former Kraken CEO Jesse Powell believes that SBF displayed “sociopathic behavior” main as much as FTX’s collapse.