Cryptocurrency exchange FTX collapses and files for bankruptcy

According to its own information, bankrupt cryptocurrency exchange FTX tracked down more than $5 billion in cash and other liquid assets. According to reports from several media outlets, the lawyers announced this on Wednesday (local time) before the responsible bankruptcy court in Wilmington (US state of Delaware). Hundreds of additional holdings with a book value in excess of $4.6 billion were identified in addition to the cash.

Lawyers for the firm said those assets were valued at the time of FTX’s loan filing in November and do not include the $425 million held by Bahamian authorities. Before the collapse, FTX was among the largest exchanges for cryptocurrencies such as Ethereum and Bitcoin.

However, it remains unclear to what extent the assets found are enough to meet the claims of the creditors.

The lawyers said the amount of the missing FTX customer funds was still unclear. Before the bankruptcy, FTX had over 9 million customer accounts.

Due to strong withdrawals of funds in the course of liquidity worries within a few days, the FTX group founded by Sam Bankman-Fried collapsed in October 2022 – billions in customer money could not be paid out. Bankman-Fried (solely called SBF in the crypto industry) resigned on November 11. He filed for bankruptcy for the group in the US state of Delaware. In the Bahamas, authorities had recently put company funds on hold.

Class action lawsuits and civil lawsuits are also pending against the FTX founder in the United States. It is a case of breathtaking tragedy: just a few months ago, the young entrepreneur – the so-called crypto prodigy – graced the front pages of US business publications. His wealth was valued at more than $26 billion for a time by Forbes and Bloomberg before the FTX collapse.

On December 12, Bankman-Fried was arrested at the behest of US law enforcement in the Bahamas, where FTX was headquartered. Other former FTX top managers admitted their guilt and charged the founder of the group massively. Bankman-Fried was released on $250 million bail after being extradited to the United States. He is allowed to stay in the house of his parents, who work as professors at the elite Stanford University in California.

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