FTX in touch with regulators, may have 1 million creditors: Filings

moneycontrol.com:

Collapsed-crypto exchange FTX outlined a "severe liquidity crisis" in U.S. bankruptcy filings, which said the group could have more than 1 million creditors, as regulators opened investigations and lawmakers called for clearer rules on how the industry operates.

FTX's filing to a U.S. bankruptcy court, published late on Monday in the United States, said it was in contact with financial regulators and had appointed five new independent directors at each of its main companies, including its sibling trading firm Alameda Research.

The exchange, which had been among the world's largest, filed for bankruptcy protection on Friday in one of the highest-profile crypto blowups after panicked traders withdrew $6 billion from the platform in just 72 hours and rival exchange Binance abandoned a rescue deal.

"FTX faced a severe liquidity crisis that necessitated the filing of these cases on an emergency basis last Friday," the court filing stated.

"Questions arose about Mr. Bankman-Fried's leadership and the handling of FTX's complex array of assets and businesses under his direction."

FTX founder and former chief executive Sam Bankman-Fried, said he expanded his business too fast and failed to notice signs of trouble at the exchange, whose downfall sent shock waves through the crypto industry, the New York Times reported late on Monday.

GRAPHIC: Top crypto exchanges by volume Top crypto exchanges by volume - https://graphics.reuters.com/FINTECH-CRYPTO/jnpwygnndpw/chart.png

There are more one hundred thousand creditors involved in the bankruptcy case, although this number could surpass one million, the filings said, as FTX requested that multiple FTX group companies file one consolidated list of major creditors, rather than separate ones.

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