Cryptocurrencies: FTX Group protects itself from its creditors in the United States

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Cryptocurrencies: the FTX group protects itself from its creditors in the United States

FTX Cryptocurrency Exchange Files for US Bankruptcy Protection.

FTX Trading Group , which specializes in cryptocurrency trading, announces that it is protecting itself from its creditors under Chapter 11 of the United States bankruptcy law.

A day after cryptocurrency exchange Binance pulled out of a deal to buy struggling competitor FTX Trading, FTX management announced Friday morning that it was placing the company under the protection of United States bankruptcy law.

West Realm Shires Services, Alameda Research – the brokerage and investment firm of Sam Bankman-Fried – and 130 other companies affiliated with the FTX group are also included in this voluntary sheltering of the assets of the American cryptocurrency platform.

According to several sources quoted by Reuters, Alameda Research is at the origin of the difficulties of FTX, due to a debt of around 10 billion dollars towards the platform.

All withdrawals and deposits were suspended Friday morning on the FTX website.

FTX cryptocurrency exchange is in trouble. Company CEO Sam Bankman-Fried is trying to raise US$8-10 billion. Explanations with Alexandre Roch, professor of finance at UQAM's School of Management Sciences.

In a statement, the company also announces that its chairman and chief executive, Sam Bankman-Fried, will be replaced immediately by John J. Ray III, who will now lead the restructured company under the supervision of the Alvarez & Marsal and Sullivan & Cromwell.

Bitcoin's value plunged to its lowest level in two years yesterday after Binance confirmed reports and rumors that it was ready to pull out of the market. agreement regarding FTX, reached between the CEOs of the two platforms on Tuesday. The deal was on hold pending Binance's due diligence on FTX's balance sheet.

Sam Bankman-Fried is one of the star players in the cryptocurrency scene. His fortune was recently estimated at $17 billion.

After an initial review, Binance said in a statement Wednesday that significant concerns ultimately convinced it to withdraw from the OK.

Binance's withdrawal forced FTX CEO Sam Bankman-Fried to urgently raise $9.4 billion in fresh capital to keep the company afloat.

The fortune of 30-year-old Sam Bankman-Fried was estimated by Forbes at around $17 billion just two months ago.

Bitcoin, the best-known cryptocurrency, lost nearly 4% of its value in the morning following FTX's announcements.

The Ontario Teachers' Pension Plan (Teachers) holds $95 million in investments on the FTX trading platform.

According to The Canadian Press, Teachers' claims to have invested in the international and U.S. arms of FTX through its Teachers Venture Growth platform to secure equity on a small scale in the emerging cryptocurrency sector.

Teachers' also wishes to reassure its investors that any financial loss on its investment in FTX will have only a limited impact on the pension plan, since the investment fund was created by Teachers'.

The investment represents less than 0.05% of its total net assets, adds the Teachers'.

However, it doesn& #x27;it's not just the Teachers' that has left feathers in the cryptocurrency market lately. The Caisse de depot et placement du Québec also lost $200 million in investments in cryptobank Celsius Network, which also filed for bankruptcy protection last July. p>

A former business partner accused Celsius of being a fraudulent Ponzi scheme (or pyramid scheme) in a lawsuit filed in New York State.

With the information from Associated Press, Reuters, and La Presse canadienne

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