The speculation of bankruptcy of FTX Exchange has come to an end. It seems to be nothing working out in the favor of the cryptocurrency industry these days, One of the largest exchanges FTX has gone Bankrupt and filed a Chapter 11 Bankruptcy to protect the user’s funds.
The FTX CEO has also resigned.
The FTX statement says, Sam Bankman-Fried, 30, has resigned as CEO and will be replaced by John J Ray III, an American lawyer who rose to prominence in 2004 when he was appointed to oversee the liquidation of Enron, the Texas energy company that collapsed in 2001 after massive financial fraud was exposed.
According to CNBC, the bankruptcy filing revealed that FTX had over 100,000 creditors, assets ranging from $10 billion to $50 billion, and liabilities ranging from $10 billion to $50 billion.
According to the crypto website CoinGecko, the volume of trades at FTX this year has been $627 billion, putting it in the top five exchanges with industry leader Binance. ‘FTX’ with the Market Value of $32 Billion, ‘
According to the New York Times has suddenly collapsed overnight due to the massive selling of its exchange native token called ‘FTT and the suspicious leaked balance sheet of its associate company ‘Almeda Research’ has raised numerous questions which led to the downfall of the empire of Sam Bankman-Fried’s FTX, saw $6 billion in withdrawal requests over three days, causing a liquidity crunch.
On June 30, CoinDesk stated that Alameda’s balance sheet was made up of 40% FTT, including $2.2 billion used as collateral for some of its $7.4 billion in loans. In the aftermath of such revelations, one of the largest crypto exchanges, Binance, announced that they are going to liquidate their holding of over $500 million dollars, which caused a panic situation among people and they began selling their ‘FTT’ Tokens, but in the end, Binance Owner Changpeng Zhao confirmed in a tweet that they are going to acquire FTX, but later after a day he refused and raised his hands from the deal.
As a result, the crypto market crashed, and people began withdrawing their funds from the FTX exchange and started selling their native token ‘FTT’ Which led to a Massive Drop in the price of the token and FTX CEO Sam Bankman-Fried’s loss of $16 Billion Dollars of Net worth in a blink of a day.
Now FTX, couldn’t come up with the money to withdraw requests of its users after suffering a failed acquisition attempt by the competitor Binance. They decided to file for Chapter 11 Bankruptcy to protect the funds of its users and give maximum money to its investors and creditors.
According to CNBC, the bankruptcy filing revealed that FTX had over 100,000 creditors, assets ranging from $10 billion to $50 billion, and liabilities ranging from $10 billion to $50 billion.
According to the crypto website CoinGecko, the volume of trades at FTX this year has been $627 billion, putting it in the top five exchanges with industry leader Binance.
FTX CEO Bankman-Fried wrote on Twitter this Friday :
‘I’m really sorry, again, that we ended up here. Hopefully, things can find a way to recover,”
Now, nobody can predict the future uncertainty and how Sam Bankman-Fried will come out of this massive mess, and how he will manage to give back money to its users, but according to the crypto experts the crypto market will grow massively in the next 10 years, but the incident like this will make a larger impact and will show a negative perspective of crypto among people.
