Crypto exchange FTX filed for Chapter 11 bankruptcy protection in the U.S.
FTX Group entities, which include the FTX.com entity as well as FTX US, Alameda Research and “approximately 130 additional affiliated companies,” have filed for Chapter 11 bankruptcy proceedings.
CEO and founder Sam Bankman-Fried, aka SBF, resigned from his role but will assist in an orderly transition. John Ray III is appointed as the new CEO.
American attorney John J. Ray III first made headlines when he was chosen in 2004 to preside over the liquidation of Enron, the Texas energy firm that crashed in 2001 after widespread financial fraud was discovered.
Ray called bankruptcy as the beginning of a path forward. He noted, “The immediate relief of Chapter 11 is appropriate to provide the FTX Group the opportunity to assess its situation and develop a process to maximize recoveries for stakeholders.”
FTX Digital Markets, FTX Australia, FTX Express Pay and LedgerX (which does business as FTX US Derivatives) are not included in the bankruptcy proceedings, as per the filing.
FTX founder SBF apologized via tweeting, “hopefully things can find a way to recover.”
“I’m piecing together all of the details, but I was shocked to see things unravel the way they did earlier this week,”. He also added, “I will, soon, write up a more complete post on the play by play, but I want to make sure that I get it right when I do.”
Respective bankruptcy filings said FTX US and Alameda Research had between $10 billion and $50 billion in liabilities and a similar range in assets. Bloomberg reported that Bankman-Fried’s wealth was down “100%” from $16.2bn earlier this year.
Also Read: SBF’s FTX Assets Frozen by Bahamas Securities Regulator
