Economic Insider

FTX: New CEO to bring back collapsed firm

Image Commercially Licensed From: DepositPhotos
Image Commercially Licensed From: DepositPhotos

Cryptocurrency exchange that didn’t work The new CEO of FTX, John Ray, is looking into how the platform can be brought back to life.

He told the WSJ that he has formed a group to look into restarting so that people who lost money can “recover more value.”

A year ago, FTX was worth $32 billion (£26 billion), but it filed for bankruptcy in November.

Money worth about $8 billion went missing, according to estimates.

Sam Bankman-Fried, the exchange’s founder and former CEO, is accused of scamming customers and investors to pay off debts from his cryptocurrency-focused hedge fund, Alameda Research.

He has said that he has not done anything wrong.

But it still needs to be clarified what will happen to customer funds in the future.

‘Total failure’

The WSJ article says that Mr. Ray is considering bringing the platform back to life instead of just selling its assets or shutting it down.

The company waited to answer when the BBC asked FTX for a comment.

Mr. Ray had previously said that he had never seen “such a complete failure of corporate controls,” which was how the failed crypto exchange was run.

He said that what he had found since taking over FTX was “unprecedented” in his 40-year career, which included being in charge of the bankruptcy of US energy giant Enron.

“Crypto winter”

The collapse of the exchange was one of the most important things that happened to businesses during what has been called a “crypto winter.”

The first big surprise came in May of last year when Terra Luna and TerraUSD, two tokens that Terraform Labs owned, lost value.

Because of the drop, many other cryptocurrencies, including Bitcoin, lost $400 billion (£318 billion) in value.

In September, Interpol sent a red notice to all law enforcement agencies asking them to arrest Do Kwon, who started Terra.

One of the biggest exchanges, FTX, which was used by millions of people to get into the cryptocurrency market, closed down in November. This made the cryptocurrency market even riskier.

It was thought to be one of the most reliable platforms, but it went bankrupt in just a few days when it became clear that its finances were unstable.

Mr. Bankman-Fried, who started FTX, told the BBC in his last interview before he was arrested, “I don’t think I tried to do anything wrong.”

The 30-year-old was sent back to the United States in December from the Bahamas, where FTX was based. He was accused of stealing money from customers and investors, but he said he wasn’t guilty in court. So, he was set free on a $250 million bail, and he denied the charges.

FTX ‘robbed’ of $415 million

The cryptocurrency exchange did not work FTX says that hackers have stolen cryptocurrency worth about $415 million (£338 million).

Since the company went bankrupt, hackers stole about $323 million from its international exchange and $90 million from its US platform, says the CEO of FTX.

Sam Bankman-Fried is accused of taking billions of dollars from FTX users to pay off debts at his other company, Alameda Research. He helped start FTX.

Mr. Bankman-Fried has said that he’s not guilty of fraud.

The company also said that both its international and US exchanges had big problems.

But it didn’t say how much the total liabilities would be.

In a press conference last month, federal prosecutors said that the crash of the platform where people could buy and sell digital tokens was caused by “intentional fraud.”

Prosecutors said that Mr. Bankman-Fried stole money from FTX customers without their permission and used it to pay off debts at his other business, Alameda, and make other investments.

They told the public about eight criminal charges, such as wire fraud, money laundering, and breaking campaign finance laws. People in charge of the world of finance also sued Mr. Bankman-Fried. He has said he’s innocent.

Later on Tuesday, Mr. Bankman-Fried said again, “FTX US has always been solvent.”

FTX gets back assets worth more than $5bn

A lawyer for the company says that the failed cryptocurrency exchange FTX has found assets worth more than $5bn (£4.1bn).

Wednesday, a US bankruptcy court was told that it is still unclear how much money customers have lost.

Prosecutors say that Sam Bankman-Fried, who used to be the CEO of FTX, ran an “epic” scam that could have cost billions of dollars to investors, customers, and lenders.

Investors say that Mr. Bankman-Fried lied to them, but he has said he is not guilty.

Mr. Dietderich said that the assets that the Securities Commission of the Bahamas seized, where FTX was based and where Mr. Bankman-Fried was living when he was arrested, are not part of the recovered funds.

Most people who stand to lose money because of FTX have yet to be named in the hearings.

But court documents talked about Tom Brady, his ex-wife Gisele Bündchen, and the owner of the New England Patriots, Robert Kraft.

In December, the 30-year-old man was caught in the Bahamas and sent to the US. He is said to have pulled off “one of the biggest financial cons in US history.”

Last year, FTX was worth $32bn. Then, on November 11, the company filed for bankruptcy. It’s thought that $8 billion of the customers’ money went missing.

US federal prosecutors say Mr. Bankman-Fried stole money from FTX customers and used it to pay off debts at his cryptocurrency trading company Alameda Research and make other investments.

In December, prosecutors announced eight criminal charges, including wire fraud, money laundering, and breaking campaign finance laws. People who keep an eye on the financial world have sued Mr. Bankman-Fried.

Read Also: FTX founder denies allegations of fraud

Gary Wang, who helped start FTX, and Caroline Ellison, who used to run Alameda, have also been accused of playing a part in the company’s failure. Both of them, the police said, were helping with the investigation.