- Sam Bankman-Fried has announced that the FTX exchange has filed for Chapter 11 bankruptcy in the US.
- This proceeding will be joined by approximately 130 additional affiliated companies that are part of the proceedings, including Alameda Research, Bankman-Fried’s crypto trading company, and FTX.us, the company’s US subsidiary.
- Bankman-Fried also stepped down as CEO and was succeeded by John J. Ray III, although SBF will stay on to help with the transition.
In the world of cryptocurrencies, there is no talk of another topic other than FTX. One of the most important exchanges in the world is in check, there are doubts about its financial capacity and this fully impacted the market, and despite the fact that on Thursday, November 10, it had a respite, there is still fear and fear of new lows.
Fears that have increased with the official declaration of bankruptcy of the crypto platform and the announcement that its CEO, Bankman-Fried has left his position and will be succeeded by John J. Ray III, although the outgoing director will remain to help with the transition.
SBF tries to squid the market
Just a day ago the market experienced a brief moment with green numbers. Although the reason for the brief moment of green candles was not clear, some point out that it is due to the fact that the United States reported that inflation has decreased, others maintain the hypothesis that it is due to a positive reaction to the appearance of Sam Bankman-Fried, the CEO of FTX.
After days of not publishing about the situation, on November 10 SBF manifested itself through social networks trying to bring some peace of mind and asking for patience. Two things that users of the platform today do not have…
With the comment “Sorry. I have ruined it and I should have done better”, she began her series of tweets in which he reported that Alameda, a company he co-founded with more than $1 billion in assets, will go out of business.
In addition to this announcement, SBF confirmed that its exchange saw $5 billion escape to other wallets.
SBF recognized the crisis, which was impossible to hide, but assured that the firm had more assets than liabilities, so client funds would not be at risk, however it recognized that many were not liquid, therefore it could not cover the lawsuit acknowledging that it made mistakes and one was the fact of believing that it could support up to 24 times the daily average of platform withdrawals when it could only face eight tenths of Sunday’s withdrawals, which amounted to $5,000 million dollars.
“Right now, we are doing everything we can to get liquidity. I can’t promise anything about it. But I’m going to try”, said Bankman-Fried, who is probably going through the same situation as Do Kwon, the founder of the long-defunct Terra ecosystem.
FTX officially declared bankrupt
Despite Sam Bankman Fried tried to calm the market with his tweets, the market did not forgive and today officially SBF has announced that the FTX exchange has filed for Chapter 11 bankruptcy in the US.
According to the press release shared by the company, this procedure will be joined by approximately 130 additional affiliated companies that are part of the procedures, including Alameda Research, Bankman-Fried’s crypto trading company, and FTX.us, the US subsidiary of Bankman-Fried. the company.
In addition to this announcement, it was also revealed that Bankman-Fried has stepped down as CEO and was succeeded by John J. Ray III, although SBF will stay on to help with the transition.
The step by step of the FTXgate
- CZ announces that it will sell FTT positions for more than 500 million dollars, which it obtained after having contributed to the exchange in 2019, due to differences with FTX directives.
- FTX adds massive capital outflows, which, as confirmed by Sam Bankman-Fried, reached 5,000 million dollars.
- The FTT token fades and loses more than 80% of its capitalization in a few days. The liquidity capacity of the exchange is also called into question.
- CZ is offered as a possible buyer. He quickly backtracks generating more doubts.
- On the day the US reported lower inflation, SBF spoke out on social media and the market found some relief.
- On November 11, the firm finally files for Chapter 11 bankruptcy along with an additional 130 FTX affiliates.
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