Crypto exchange FTX files for bankruptcy in US
By Michele Maatouk
Date: Friday 11 Nov 2022
(Sharecast News) - Cryptocurrency exchange FTX has filed for bankruptcy in the US and its chief executive, Sam Bankman-Fried, has stepped down.
Newly-appointed CEO John J. Ray III said: "The immediate relief of Chapter 11 is appropriate to provide the FTX Group the opportunity to assess its situation and develop a process to maximise recoveries for shareholders.
"The FTX Group has valuable assets that can only be effectively administered in an organised joint process.
"I want to ensure every employee, customer, creditor, contract party, stockholder, investor, governmental authority and other stakeholder that we are going to conduct this effort with diligence, thoroughness, and transparency."
News of the Chapter 11 filing came a day after rival Binance walked away from takeover discussions, citing an alleged investigation by US regulators.
FTX, which was run by 30-year-old crypto entrepreneur Bankman-Fried, has been rocked by a surge in withdrawals after concerns mounted about its financial health, causing a liquidity crunch.
On Tuesday, Bankman-Fried - one of the sector's most high-profile figures - announced FTX had "come to agreement on a strategic transaction with Binance", dependent on due diligence.
"Our teams are working on clearing out the withdrawal backlog as is," he tweeted. "This will clear out liquidity crunches; all assets will be covered 1:1. This is one of the main reasons we've asked Binance to come in. It may take a bit of time to settle - we apologise for that.
"But the important thing is that customers are protected."
However, just two days later, Binance announced it was walking away.
Abigail Townsend contributed to this report.
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